- The Intervention: CEOs of Citigroup, Bank of America, and Wells Fargo will meet with Senators on Thursday to shape the final contours of the crypto market structure bill.
- The Grievance: The Financial Services Forum is lobbying to ban interest-bearing stablecoins, viewing them as an unregulated threat to the traditional banking deposit base.
- The State of Play: Senate Democrats are actively reviewing a GOP compromise offer drafted by Banking Committee Chairman Tim Scott, marking the most serious bipartisan attempt to pass legislation this session.
The titans of Wall Street are descending on Capitol Hill to ensure the emerging digital asset framework does not undercut their business model. Negotiations over the crypto market structure bill have entered a combative new phase, with the heads of the nation’s largest banks preparing to intervene directly in the legislative process.
Behind closed doors, negotiators from both parties have spent weeks trading proposals, examining definitions that would determine whether crypto assets fall under the SEC or the CFTC.
Lawmakers are debating how to prevent the market from becoming a haven for illicit finance. Now, the effort is entering a new phase, with the heads of some of the country’s largest banks preparing to join the conversation.
Related: SEC Chair Atkins Formalizes ‘Tokenization First’ Policy to Modernize U.S. Capital Markets
The Thursday Showdown: Fraser, Moynihan, and Scharf
The next 48 hours will define the regulatory perimeter. On Thursday, Citigroup CEO Jane Fraser, Bank of America CEO Brian Moynihan, and Wells Fargo CEO Charlie Scharf are scheduled to meet with key Senators from both parties.
Coordinated by the Financial Services Forum, the executives intend to raise specific, high-stakes objections. According to sources familiar with the strategy, the banks will argue against allowing crypto platforms to offer “yield-like rewards” or interest payments on stablecoins.
Their argument is grounded in competitive equity: allowing stablecoin issuers to act like banks (taking deposits and paying interest) without adhering to Basel III capital requirements constitutes “regulatory arbitrage.”
Senate Democrats Review GOP Offer on Crypto Rules
A group of Senate Democrats met privately on Monday to review a proposed compromise on crypto market structure legislation sent to them late last week by Senate Banking Committee Republicans.
The offer, drafted under the direction of Chairman Tim Scott, represents the most serious bipartisan attempt to define the rules for digital assets this session.
The Democratic negotiating group includes Senators Kirsten Gillibrand, Mark Warner, Ruben Gallego, Lisa Blunt Rochester, Andy Kim, and Angela Alsobrooks.
They discussed how to respond to the GOP proposal and whether to submit a counteroffer. The ongoing talks follow months of disagreements over fundamental regulatory questions.
This also includes how to classify non‑stablecoin crypto assets, what authority the SEC should retain, and how to curb the use of decentralized platforms for money laundering and other illicit activities.
Momentum for a deal increased after a bipartisan meeting last week, the first in weeks, where lawmakers sought common ground on numerous policies.
Related: U.S. SEC Signals Privacy Enhancement in Tokenization of Securities
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