Senate Republicans unveil revised crypto bill ahead of crucial vote

Senate Republicans released a revised draft of major cryptocurrency legislation, known as the Clarity Act, to address objections from both Democrats and the banking industry.

The bill seeks to create a comprehensive regulatory framework for cryptocurrencies, but previously stalled over worries about ethics provisions, illicit finance safeguards and potential impacts on traditional banking.

The big picture: Senators Cynthia Lummis, John Boozman and Tim Scott announced the new draft, incorporating 126 substantial changes requested by Democrats.

• The updated text strengthens ethics restrictions, particularly targeting concerns over public officeholders’ involvement in crypto ventures, spurred in part by President Trump’s $1.4 billion crypto earnings.
• The bill now gives state attorneys general more enforcement power and includes rules from both Republican and Democratic senators.

Go deeper: Additional revisions offer new bank deposit protections, consumer safeguards, clarification of state consumer protection law applicability, restrictions on affiliate trading, and software developer protections.

• Despite revisions, the banking industry still opposes provisions allowing crypto companies to offer rewards on stablecoins, fearing increased competition for deposits.
• Crypto industry advocates have spent hundreds of millions lobbying for the bill and intensified their efforts ahead of the vote.

What we’re watching: The measure faces a challenging path and requires 60 votes to clear a critical Senate procedural hurdle as early as Tuesday.