GOP Crypto Bill Faces Setback as Senator Warns “We’re Not Ready”

Senate Republicans are facing fresh internal divisions over digital asset legislation, with a senior member of the Banking Committee signaling that efforts to advance a landmark cryptocurrency market structure bill could stall this month.

Sen. John Kennedy (R-La.) said on Wednesday that he does not believe the committee is prepared to move forward, casting doubt over Chairman Tim Scott’s pledge to mark up the bill before the end of September.

“I don’t think we’re ready,” Kennedy told reporters. “People that I talk to still have a lot of questions. I know I still have a lot of questions.” His comments represent the clearest sign yet of resistance inside GOP ranks.

Kennedy previously expressed concern that the bill, which would divide oversight of digital assets between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), could give the crypto industry too much sway over the legislative process.

His warning sets him at odds with Scott and other Republicans who have made completing a market structure bill a top priority.

Kennedy Pushback Threatens Scott’s September Deadline for Digital Asset Legislation

A spokesperson for Scott emphasized that Banking Committee Republicans believe advancing a bipartisan framework is “long overdue.”

Jeff Naft, speaking on behalf of Scott, said lawmakers have been working since June toward a September markup, citing thousands of pages of feedback and consultations with roughly 160 stakeholders. “The House has already acted, and the Senate should not fall behind,” Naft said.

The House passed its own version of the legislation, known as the CLARITY Act, in July. Meanwhile, Senate Republicans introduced the GENIUS Act earlier this summer, creating new rules for stablecoins pegged to the U.S. dollar.

But Kennedy dismissed that earlier measure as only a “baby step” compared to the broader market structure overhaul now on the table. “This is a full leap,” he said. “And we’ve got to get it right.”

The split within GOP ranks threatens to derail Scott’s self-imposed September 30 deadline. The South Carolina senator, who serves as ranking member of the Senate Banking Committee, has spent months positioning his caucus to move forward.

In June, Scott and colleagues, including Cynthia Lummis (R-Wyo.), Thom Tillis (R-N.C.), and Bill Hagerty (R-Tenn.), released a set of principles outlining how they want digital assets regulated.

The framework called for clear distinctions between securities and commodities, a shared oversight model between the SEC and CFTC, and anti-money laundering provisions designed to be “pro-innovation.”

The principles also encouraged regulators to employ tools such as safe harbors and no-action letters to engage with crypto projects. Lummis, who chairs the Banking Committee’s digital assets subcommittee, warned at the time that the U.S. risked falling behind global peers such as the European Union and Singapore if it did not act quickly.

Scott doubled down on the urgency later that month, setting a firm September 30 deadline for completing market structure legislation. Appearing at a Capitol Hill event alongside Lummis and White House adviser Bo Hines, Scott said finalizing the bill by that date was “a realistic expectation.”

Hines echoed the commitment in a June 26 social media post, stating, “We are committed to getting market structure done by the end of September. Period.”

Crypto industry leaders rallied behind the timetable. Coinbase CEO Brian Armstrong called it “a clear path forward,” while Andreessen Horowitz government affairs head Colin McCune said comprehensive rules have been “sorely needed for years.”

The industry has spent hundreds of millions of dollars on lobbying in Washington in hopes of securing long-awaited regulatory clarity.

Still, skepticism is not confined to Kennedy. Sen. Andy Kim (D-N.J.), a Democrat on the Banking panel, said there is “still a lot more work to be done” and warned that marking up the bill this month would be “a mistake.”

Democrats who have shown openness to the legislation have likewise urged Republicans to slow the process.

The legislation under debate would represent the most sweeping attempt yet to regulate the $2 trillion digital asset market, setting new rules of the road for trading platforms and asset issuers.

Its fate could determine how quickly the United States catches up to other jurisdictions with established frameworks.

Momentum for CLARITY Act Fades as Democrats Push Rival Crypto Bill

Momentum behind the Republican-led CLARITY Act is showing signs of strain despite earlier optimism that bipartisan support could carry it through Congress this year.

At the SALT Wyoming Blockchain Symposium in August, Senate Banking Committee Chairman Tim Scott predicted that 12 of 18 Senate Democrats might ultimately back the legislation.

He argued that growing bipartisan interest in setting rules for digital assets could offset resistance from figures such as Senator Elizabeth Warren, who has been outspoken against loosening oversight.

Senator Cynthia Lummis, a co-sponsor of the draft framework, went further, setting a Thanksgiving deadline for passage and promising the measure would reach the president’s desk before year-end.

Lummis said the proposal would clarify how securities and commodities laws apply to digital assets, modernize regulatory frameworks, and provide stronger consumer protections.

Yet resistance within the Democratic Party has hardened in recent weeks. On September 9, a group of 12 Democratic senators unveiled their own crypto regulation framework, the first coordinated stance by the party this year.

Their proposal emphasized tighter disclosure standards, mandatory registration of crypto platforms with the Financial Crimes Enforcement Network, and strengthened oversight by both the SEC and CFTC.

Notably, it also included provisions designed to limit political conflicts of interest by blocking elected officials and their families from profiting from digital assets.

That release has altered expectations around the bill’s future. On prediction platform Polymarket, bettors now assign just a 32% chance that the CLARITY Act will be signed into law in 2025, down sharply from nearly 90% in July.

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