Senate market structure markup by Christmas?

The U.S. Senate is reviving faint hopes of market structure markups by Christmas, while the crypto sector reminds legislators that their fate hangs in the balance, and the next Federal Reserve chair could be a major bagholder.

Congress is currently in recess after lawmakers headed home to carve up Thanksgiving turkeys with their families/constituents, meaning little work is being done on advancing legislative priorities. However, at least some members of the Senate reportedly remain optimistic that their digital asset market structure legislation could clear a major hurdle before Congress adjourns for the Christmas holidays.

On November 25, Crypto in America journo Eleanor Terrett tweeted that Senate Democrats working on market structure legislation are preparing for a possible markup session of a bipartisan bill the week of December 8. Terrett cautioned that this session could be delayed until the week of December 15, the last working week before Congress concludes its activity for the year.

It wasn’t specified which Senate committee might be preparing this session. The Senate Banking Committee has yet to release a bipartisan market structure bill, only the version crafted by the committee’s majority Republican leadership. Banking’s Dems have chafed at their lack of input into this process, which, if left unresolved, could spell trouble when a final draft comes up for a vote on the Senate floor.

The Senate Agriculture Committee released a bipartisan draft, but it included huge chunks of ‘bracketed’ text, indicating areas of major disagreement that have yet to be resolved. These sections include nearly everything to do with decentralized finance (DeFi) protocols and the potential liabilities for developers if their tools are used by criminal elements.

The original timelines for markups by the end of September proved no match for partisan bickering and the longest government shutdown in U.S. history. But both committee chairs have signaled their eagerness to proceed to markup sessions on their respective bills in December.

Once the two bills are marked up to everyone’s satisfaction, they must be fused into one. Only then can a Senate floor vote occur. Assuming a positive outcome, the bill will then head to the House of Representatives for approval. But if the House amends the bill’s language, it will have to return to the Senate. So, there’s still a long path to a finished bill reaching President Trump’s desk for signing into law.

Midterm mayhem awaits

Multiple legislators and industry figures have expressed concern that if the Senate doesn’t get a move on, the Congressional focus could quickly turn to next year’s midterm elections. While crypto-friendly senators insist they’ll get it done, the industry is oh-so-subtly reminding them of the potential consequences of failing to deliver.

On November 24, the Stand with Crypto (SwC) ‘advocacy organization’ announced the release of its 2026 midterms candidate survey. The survey is intended to “help voters understand where candidates stand on key issues affecting cryptocurrency and the growing digital economy.”

The questionnaire has been sent to incumbents and non-incumbents in both federal and state-level races, asking them to “disclose their beliefs around individual rights to digital assets, crypto innovation, de-banking, crypto mining and zoning, consumer protections, accessibility, and more.” Candidates are also asked if they’ve ever personally bought/sold/used tokens and/or blockchain tools.

For a couple of years now, SwC, which is funded by the Coinbase (NASDAQ: COIN) digital asset exchange, has assigned politicians a rating based on their level of support or perceived antagonism towards all things blockchain. SwC says it will release the results of its latest survey by “early 2026” so voters know where their local candidates stand.

The same day that SwC’s survey went out, The Digital Chamber (TDC) crypto advocacy group announced the launch of its State Network, “an initiative designed to unify, strengthen, and elevate digital asset advocacy at the state level.”

TDC’s new initiative will focus on advancing and supporting actionable policy campaigns in priority states, “providing guidance in legislation development and rulemaking,” ensuring pro-blockchain views are “represented consistently,” and more.

TDC is also rolling out a State Network Microgrant Program that will provide small grants to support “state-level research, innovation pilots, educational programs, and community outreach efforts focused on blockchain and digital asset policy.”

Crypto-focused political action committees (PACs) have amassed a $263 million war chest ahead of the midterms, although it’s unclear how much of that they intend to allocate in 2026. The 2024 election cycle saw crypto PACs spend $133 million electing pro-crypto candidates and defeating anti-crypto incumbents. They’re obviously intent on ensuring candidates don’t forget the carrots/sticks they can bring to this fight.

The ostensibly bipartisan Fairshake blazed this crypto PAC trail but has since been joined by an army of competing groups, some of which make no secret of their pro-GOP/anti-Dem mission. Others, like The Fellowship PAC (reportedly backed by USDT stablecoin issuer Tether), have stated a need to advocate on behalf of the entire crypto sector, not just for policies that favor Coinbase (Fairshake’s biggest financial contributor).

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Hassett for Fed chair?

As Americans gather on Thursday for their Thanksgiving holiday, the digital asset HODLers among them might feel they have little to be thankful for. The fiat value of prominent tokens like BTC and ETH ;plunged by one-third over the past six weeks, and while they’ve since rebounded (slightly) from their recent lows, they’re still a long way from reclaiming their former glories.

But hope springs eternal that the new year will bring a surge in token prices thanks to expected cuts in interest rates by the U.S. Federal Reserve. Current Fed chair Jerome Powell has resisted Trump’s demands to cut rates, but he will exit the role in May. Word is that Trump plans to nominate Kevin Hassett, director of the White House National Economic Council (NEC), for the position.

While Trump is said to still be mulling multiple candidates for Powell’s seat, Bloomberg reported this week that Hassett had the inside track, in part because Hassett has publicly stated that the Fed should cut interest rates, based on his view that the economic data warrants such cuts.

But the perpetually grinning Hassett has built a reputation for endorsing basically anything Trump says/wants. In July, the Washington Post questioned Hassett’s “Trump-era makeover,” noting that he’d previously expressed positions sharply divergent from Trump’s views on numerous matters, including tariffs, protectionism, and immigration.

In September, Politico quoted multiple friends/ex-colleagues expressing concern about Hassett taking the Fed job. One said: “I’ve seen him go on TV and make arguments that really make no sense in support of this administration’s policies … It’s a scary thought to have the kind of Fed chair that’s willing to sacrifice the central bank’s independence out of loyalty to the president.” Another added, “I think he’ll do what Trump wants him to. And that’s not what we need at the Fed.”

For the crypto sector, it’s likely more important that Hassett serves on the White House’s Presidential Working Group on Digital Asset Markets, a subset of the NEC informally known as the ‘crypto council.’ In August, the Group released a 166-page report detailing the administration’s plan to “ensure crypto becomes a hallmark of the new American Golden Age.”

Hasset disclosed this summer that he holds a stake in Coinbase worth at least $1 million and possibly as much as $5 million. Regardless of where exactly the actual number falls within that range, it would represent a significant portion of the total $7.6 million in assets Hassett reported. Hassett also reported a salary of $50,001 from Coinbase for his role on the exchange’s Academic and Regulatory Advisory Council.

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SEC to talk tokenization

The U.S. Securities and Exchange Commission (SEC) announced this week that its Investor Advisory Committee will host a virtual public meeting on December 4. The meeting will feature a panel discussion of the “Tokenization of Equities: How Issuance, Trading, and Settlement Would Work with Existing Regulation.”

The meeting agenda promises to explore how tokenization can improve the public equities ecosystem, the application of existing investor protections and securities laws, the issuance and trading of natively issued securities and wrappers, the interoperability of tokens issued across different blockchains, and much more.

Tokenization of equities became front-page news this year as the Robinhood (NASDAQ: HOOD) platform began offering tokenized stock trades of U.S. companies to its European Union customers. One of the advantages of tokenized equities is the ability to trade 24/7, regardless of whether the market on which these stocks are listed is open for business.

Robinhood’s senior director, Coy Garrison, will be among the panelists discussing the matter with the SEC, along with Alex Thorn, head of firmwide research at Galaxy Digital (NASDAQ: GLXY), and Coinbase’s VP of global regulatory policy Scott Bauguess.

Representing the traditional securities world will be BlackRock (NASDAQ: BLK) senior managing director Samara Cohen, NASDAQ senior VP Chuck Mack, and Citadel Securities managing director Jonah Platt.

In August, Citadel wrote the SEC to express its concerns over crypto operators horning in on their turf. Citadel warned that these operators wanted to offer ‘lookalike’ products without any of the restrictions imposed on tradfi securities brokers. Citadel urged the SEC to “resist self-serving requests for broad exemptions from longstanding securities regulations.”

But SEC chair Paul Atkins has embraced tokenization, praising Robinhood’s efforts as an example of the ‘innovations’ he wants to exempt from scrutiny via the SEC’s Project Crypto. In October, Atkins called crypto and tokenization “job one” for the SEC, stating a goal of being “very forward-leaning … to accommodate new ideas.”

In August, the U.K.-based World Federation of Exchanges (WFE) expressed alarm at the “growing investor protection risks linked to the third-party tokenization of mostly U.S. equities by unregulated brokers and crypto-asset trading platforms.” The WFE’s members include many of the world’s largest exchanges, including stateside giants Nasdaq, Cboe, and CME Group.

On November 21, the WFE sent a letter to the SEC’s Crypto Task Force that apparently followed a meeting in Washington on this topic. The WFE stressed that, while tokenization is “likely a natural evolution in capital markets,” this evolution “must be done in a responsible way that does not put investors or market integrity at risk.”

The WFE praised the concept of exemptive relief from regulatory burdens, but not where said relief “would merely be more convenient or less burdensome or would provide a competitive advantage.”

For example, the WFE is cool with relief on issues involving maintaining paper records or custody of assets in certain control locations that were designated long before blockchain’s existence. The WFE is less cool with “relief from registration requirements for trading platforms that simply do not wish to be saddled with the requirements of being an SEC registrant and subject to Exchange Act standards applicable to registrants.”

The WFE urged the SEC to offer relief only when it aligns with “investor protection, market integrity, and fair competition.” Exemptive relief orders should be narrow, time-limited, and conditional upon multiple factors (applying robust anti-money laundering requirements, maintaining adequate safeguards like asset segregation, etc.).

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CFTC looking for a few good CEOs

Michael Selig, the nearly confirmed chairman of the Commodity Futures Trading Commission (CFTC), still requires a favorable vote by the full Senate, but acting chair Caroline Pham isn’t twiddling her thumbs until he gets there.

On November 25, Pham issued a call for public nominations to a new CFTC CEO Innovation Council. To ensure the success of the CFTC’s Crypto Sprint, Pham said, “it is critical that the CFTC drives public engagement with the support of expert industry leaders and visionaries who are building the future.” Pham wants average Joes/Janes to nominate potential Council members and “propose potential topics to prioritize.”

Before anyone gets the idea to nominate Euro Pacific Capital CEO (and renowned crypto skeptic) Peter Schiff, Pham says nominations must be accompanied by “information that supports the individual’s qualifications” for the Council. Submissions are due by December 8.

Pham raised eyebrows when she tweeted the CEO announcement from her personal account and started the tweet with the question “Are you locked in?” Earlier that day, Pham used the phrase ‘Lock in’ when she tweeted a picture of herself beside a nameplate indicating her acting chairman status. Neither tweet explained exactly what she meant by this phrase, but fans of the XRP token issued by Ripple Labs think they know.

‘Lock in’ is common verbiage among Ripple execs, including CEO Brad Garlinghouse, who has signed off more than one of his tweets with the phrase, including one just a month ago celebrating Ripple’s acquisition of prime broker Hidden Road.

Ripple CTO David Schwartz also tweeted the phrase a year ago, while the official Ripple account has done likewise. Many XRP fans have taken these utterances as signs that XRP holders should avoid selling their XRP because its value is set to soar (or something). For the record, XRP didn’t moon after Pham’s tweets.

Pham’s use of the phrase has some speculating that XRP could soon come under the regulatory oversight of the CFTC rather than the SEC, with which Ripple Labs fought a long and costly legal fight over whether XRP is a security. That question seems increasingly irrelevant in the current anything-goes climate, but there are some who believe this distinction still matters.

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Chocolate/peanut butter, SEC/CFTC

When a market structure bill reaches Trump’s desk, it will likely feature language assigning the primary role of digital asset oversight to the CFTC, with a secondary role for the SEC. Much of the senatorial arguing over the legislation is about carving out clear lanes for the two regulators to minimize market confusion.

However, Timothy Massad, a former CFTC chair and a fixture at Congressional crypto hearings, believes he has a simpler solution: just merge the two regulators into a single agency. Massad sketched out his views in a Brookings Institution commentary earlier this month, calling a merger “the best way to regulate digital assets.”

Massad argues that “effective regulation will require disclosures to investors about the tokens that are listed and traded,” and while disclosures are a key function of the SEC, they’re not on the CFTC’s radar.

As for the thorny question of whether a token is a security or a commodity, a merged regulator is better equipped to “develop the nuanced taxonomy and standards that can evolve with the market and use case.” Both regulators working under the same roof “will ensure that there is a continuum of standards that addresses how tokens evolve.”

Massad notes that merging the SEC/CFTC has been suggested before without any action taken, and there’s a sense that “the crypto markets are not sufficiently important to justify a radical step that we have declined to take in the past.” But Massad suggests this could change if tokenization makes its expected inroads into traditional markets.

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