The US Senate Banking Committee’s cryptocurrency market structure faces a heavy wall of amendments ahead of Thursday’s tokenization, as lawmakers introduced more than 100 proposed changes to the CLARITY Act. The rush to tweak stablecoin rewards, cryptocurrency companies’ access to the Federal Reserve System and even the use of digital assets to pay taxes is at the center of Washington’s latest battle over cryptocurrency regulation.
According to Politico, committee members offered more than 100 amendments before the additional vote. Cryptocurrency journalist Eleanor Terrett reports that Senator Elizabeth Warren alone has introduced more than 40 amendments, including one that would prevent the Federal Reserve from issuing master accounts to cryptocurrency companies. Teret also pointed to an amendment introduced by Senator Jack Reed that would “prevent the use of cryptocurrencies as legal tender, for example, to pay taxes.”
Such language would directly contradict one of the industry’s longest-standing policy goals: expanding digital assets beyond investment and commerce into payments, settlement, and public sector use cases. Terrett noted the contrast with previous pro-Bitcoin tax payment proposals, writing that Representative Warren Davidson introduced a bill last year to “do this very thing” with Bitcoin.
Cryptocurrency bill introduces high-risk Senate tokenization
The latest clash comes after Senate Banking Committee Chairman Tim Scott, Senator Cynthia Lummis and Senator Thom Tillis released new market structure text that will serve as the basis for the committee’s markup. The committee said the text reflects negotiations with Democrats and input from lawmakers, regulators, law enforcement, financial institutions, innovators and consumer advocates. Scott framed the bill as a measure for consumer protection and national competitiveness.
“Over the past year, we have listened, negotiated and strengthened this bill because families, small businesses, investors and innovators all benefit from clear rules of the road,” Scott said. “This bill reflects the hard work and good faith across the committee and provides the certainty, assurances, and accountability Americans deserve.”
The most pressing fault line remains stablecoin rewards. The Senate text would prohibit rewards on inactive stablecoin balances that closely resemble bank deposits, while allowing rewards tied to transaction-based activities, such as stablecoin payments. The SEC, CFTC, and Treasury Department will be tasked with issuing joint rules to implement this ruling.
The banks are not satisfied. Brendan Pedersen reports that Reed and Senator Tina Smith have introduced an amendment that would include bank-requested changes to stablecoin revenue limits, forcing lawmakers to choose between the cryptocurrency and banking industries. The amendment will target rewards that are “substantially similar” to interest on deposits, a phrase that gets to the heart of the banking lobby’s argument: cryptocurrency platforms should not be allowed to compete with deposits through return-like incentives while avoiding bank-style regulation.
Terrett separately reported that members of the American Bankers Association sent more than 8,000 letters to Senate offices urging lawmakers to review the stablecoin yield settlement. The ABA has argued that the current language does not adequately close what it calls a loophole that allows exchanges and other digital asset service providers to bypass the GENIUS Act’s ban on interest or yield on stablecoins for payment.
The bill also reaches beyond stablecoins. Digital commodity exchanges, brokers and traders will be treated as financial institutions under the Bank Secrecy Act, which will bring them into anti-money laundering, customer identification and due diligence systems. The text would also allow cryptocurrency companies to raise up to $50 million annually, and up to $200 million overall, without SEC registration, making clear that tokenized securities remain subject to securities law.
The political track remains fragile. Senate Minority Leader Chuck Schumer appeared engaged in a Democratic caucus and was eager for members to reach a “yes” on the CLARITY Act, Teret said, but stressed that ethics negotiations needed to move forward before Thursday’s deadline. Warren, the committee’s top Democrat, has pressed the issue hard, saying the bill “puts investors, our national security, and our entire financial system at risk” and would “add more to Donald Trump’s crypto corruption” without stronger conflict-of-interest provisions.
At the time of publication, the total market cap of cryptocurrencies was $2.67 trillion.
Featured image created with DALL.E, a chart from TradingView.com
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