U.S. Lawmakers Propose Landmark Crypto Regulation Bill Amid Political Division

A major legislative step toward regulating digital assets in the United States was taken on May 5, 2025, when Republican leaders from the House Financial Services and Agriculture Committees introduced a new draft of the crypto market structure bill. The proposal aims to clearly define the regulatory responsibilities of the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC), addressing long-standing industry concerns over jurisdictional confusion and inconsistent enforcement. The draft expands upon the previous Financial Innovation and Technology for the 21st Century Act (FIT21), which passed out of committee last year but stalled in Congress.

The legislation outlines a framework where certain digital assets—particularly those that are decentralized enough—would fall under the oversight of the CFTC, while others that resemble traditional securities would remain under the SEC’s purview. This distinction is seen as crucial for fostering regulatory clarity and allowing blockchain-based innovation to thrive without fear of arbitrary enforcement. The bill also sets rules around custody, consumer protection, and market integrity, aiming to align the crypto ecosystem more closely with traditional financial regulations.

However, the rollout of the draft legislation is already facing political turbulence. Representative Maxine Waters, the top Democrat on the House Financial Services Committee, announced her intention to block a planned joint hearing on the bill. She expressed concern about the increasing political influence of former President Donald Trump, who has recently taken a more public and supportive stance toward cryptocurrency. Waters and other Democrats argue that the bill could tilt too far in favor of industry interests, weakening investor protections and enabling regulatory arbitrage.

Despite the friction, the reintroduction of a structured crypto framework signals growing bipartisan recognition of the need for a clear, unified regulatory approach. While the path forward remains uncertain amid election-year politics, the renewed push for comprehensive crypto legislation is a sign that the U.S. is beginning to take digital asset regulation more seriously. The industry and policymakers alike will be closely watching how this bill progresses—and whether it can bridge the widening partisan gap on financial innovation.