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▲ Bitcoin (BTC), Crypto Regulation, US Congress/AI Generated Image
The US cryptocurrency market structure bill, once a promising candidate with nearly an 80% chance of passing, has plummeted to a 48% coin-toss bill, putting the pursuit of regulatory clarity for US cryptocurrencies at risk of long-term drift once again.
Louis Raskin, host of the crypto-specialized YouTube channel Coin Bureau, diagnosed in a video uploaded on July 2 (local time) that the likelihood of the US cryptocurrency market structure bill passing has sharply decreased in just six weeks. Polymarket reflected the bill's passage probability at 74-82% in May but has now lowered it to approximately 48%, and Galaxy Research has also downgraded its forecast from 75% to 60%. Raskin pointed out, "People who have bet money on the market are telling a different story than the headlines."
This bill is key legislation to resolve the jurisdictional conflict between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), which has persisted for over a decade in the US cryptocurrency market. It proposes a structure where sufficiently decentralized assets like Bitcoin (BTC) are considered commodities and fall under CFTC jurisdiction, while tokens sold by centralized teams for fundraising purposes are classified as securities and fall under SEC jurisdiction. Coin Bureau evaluated this bill as the second regulatory pillar, following the stablecoin regulation act GENIUS.
The biggest political obstacle is the controversy surrounding the conflict of interest in the cryptocurrency business of former US President Donald Trump's family. The video, citing a Reuters report, stated that the Trump family has added at least $2.3 billion in wealth from cryptocurrency businesses since the start of a second term. World Liberty Financial, memecoins, and Bitcoin mining companies are at the center of the controversy, and a transaction where an investment vehicle linked to a UAE national security advisor acquired a 49% stake in World Liberty Financial for approximately $500 million was also presented as an issue. The revelation that about $218 million of this was prepaid to entities connected to the Trump family and Trump's special envoy to the Middle East fueled opposition from Democrats.
Section 604, a provision for the protection of DeFi developers, is also holding up the bill. This section aims to protect developers of non-custodial protocols, where users directly control their funds, from being prosecuted as unlicensed money transmitters merely for writing code. Over 60 CEOs and founders, including Coinbase, Uniswap, and a16z, considered this provision a non-negotiable line, while law enforcement organizations such as the National Sheriffs' Association and the International Association of Chiefs of Police countered that it could create loopholes in tracking illicit funds and enforcing anti-money laundering measures.
Senate vote calculations also make the bill's passage difficult. To overcome a filibuster, 60 votes are required, and with only 53 Republican seats, at least 7 more Democratic votes are needed. Currently, there are only two supportive Democratic votes, Ruben Gallego and Angela Alsobrooks, and even these are conditional approvals, contingent on resolving ethical provisions and illicit finance issues. If two Republicans, such as Josh Hawley and Rand Paul, oppose the bill, then 9 Democratic votes would be needed. Coin Bureau warned that if a plenary session schedule is not set before the Senate recess on August 7, the next realistic window for the US cryptocurrency market structure bill could be pushed back to 2030.
The delay of the bill could also be a direct variable for the cryptocurrency market. Standard Chartered projected that if the bill passes and XRP's commodity status is clarified, $4 billion to $8 billion could flow into XRP ETFs. However, Coin Bureau analyzed that while the bill is not yet dead, the path to passage could only reopen if ethical provisions acceptable to the White House, a compromise on Section 604 acceptable to law enforcement agencies, persuasion of moderate Democrats, and scheduling a plenary session before August 7 all align simultaneously.
[Key Article Summary]
-The probability of the US cryptocurrency market structure bill passing has fallen from around 80% to approximately 48%.
-The controversy over the Trump family's conflict of interest, Section 604 (DeFi developer protection provision), and a lack of Senate votes have been identified as key variables hindering the bill's passage.
-A warning has been issued that if a Senate plenary session is not scheduled before August 7, reform of the US cryptocurrency market structure could be delayed until 2030.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses incurred based on it. The content should be interpreted for informational purposes only.*
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