June 22: This week in crypto federal policy
DC Decentralized: A weekly newsletter on developments in digital asset and blockchain federal policy
This week decoded
This week in crypto federal policy, Congress focuses on market structure, payments innovation, and national security, as multiple House committees examine the future of investing, small business capital formation, and financial competition with China. Senate negotiators will participate in a sprint of meetings this week to attempt to merge the Agriculture and Banking versions and find agreement in the tough remaining details of the CLARITY Act market structure bill.
In the agencies, stablecoins remain at the center of regulatory activity, with banking regulators proposing new customer identification requirements under the GENIUS Act framework. The CFTC and SEC are seeking to harmonize definitions in derivatives regulations and data reporting in swaps and swap markets. The CFTC is seeking public comment on guidance that unduly impedes fintech firms from partnering with financial intermediaries.
Read more below
Congress
Hearings
This week
On June 24, the House Financial Services Committee holds a hearing on “Future of Payments: Promoting Innovation and Fair Markets.”
On June 25, the House Financial Services Subcommittee on Capital Markets held a hearing on “From Wall Street to Main Street: The Future of How America Invests.”
On June 25, the House Small Business Committee held a hearing on “From Startup to Scale: The Role of the SBA Office of Investment and Innovation in Powering America’s Small Businesses.”
On June 25, the House Select Strategic Competition Between the United States and the Chinese Communist Party Committee holds a hearing on “China’s Economic Espionage and Subnational Influence in the United States.”
Legislation
Sens. Ruben Gallego (D-AZ) and Cynthia Lummis (R-WY) introduced a resolution to express that Sam Bankman-Fried, the co-founder of FTX, should not receive a presidential pardon, commutation, or any other form of Federal clemency. (Text)
Correspondence
Sens. Cynthia Lummis (R-WY), Kirsten Gillibrand (D-NY), Bill Hagerty (R-TN), Angela Alsobrooks (D-MD), Kevin Cramer (R-ND), Catherine Cortez Masto (D-NV), and Pete Ricketts (R-NE) sent a letter to Treasury Secretary Scott Bessent urging the Treasury Department to preserve the role of states in chartering and supervising payment stablecoin issuers. (Letter)
Sens. Adam Schiff (D-CA), Elizabeth Warren (D-MA), Richard Blumenthal (D-CT), and Chris Van Hollen (D-MD) sent a letter to Treasury Secretary Scott Bessent and Acting Attorney General Todd Blanche requesting information about cryptocurrency exchange Binance’s role in facilitating sanction evasions by the Iranian regime through millions of dollars in cryptocurrency transactions on the exchange. (Press release)
Publications and Events
On June 25, Rep. William Timmons (R-SC) will host a roundtable titled “Two Sides of a Digital Coin: Protecting U.S. Security by Challenging the Power of Repressive Foreign Regimes” to examine the ways digital assets like cryptocurrency can empower individuals living in repressive or economically unstable nations by allowing them to protect their finances, access essential aid, and preserve economic autonomy, especially when state-controlled systems collapse or are used against citizens and the national security implications of U.S. leadership and competitiveness in the digital finance space. (Notice)
Trump Administration
Banking Regulators
The Financial Crimes Enforcement Network (FinCEN), the Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation (FDIC), and the National Credit Union Administration (NCUA) jointly issued a proposed rule on a Permitted Payment Stablecoin Issuer Customer Identification Program to implement the Guiding and Establishing National and Innovation for U.S. Stablecoins Act (GENIUS Act) directives to treat permitted payment stablecoin issuers as financial institutions under the Bank Secrecy Act and to require issuers to maintain an effective customer identification program. The comment period ends on August 21. (Federal Register)
Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC)
The SEC and CFTC issued a joint request for public comment on potential opportunities to harmonize, modernize, and streamline data reporting requirements in their regulation of the security-based swap and swap markets. (Press release)
The SEC and CFTC also issued a joint request for public comment on potential opportunities to further update, clarify, and harmonize certain derivatives product definitions and interpretive issues. (Press release)
Commodity Futures Trading Commission (CFTC)
The CFTC published a Request for Information on identifying Commission regulations, guidance documents, orders, no-action letters, and other items that may unduly impede fintech firms from entering into partnerships with financial infrastructures and intermediaries regulated by the Commission, as well as regulations, guidance documents, orders, no-action letters, and other items that could be amended to streamline application processes for eligible fintech firms seeking registrations and authorizations from the Commission, while balancing innovation interests with the importance of safety and soundness, consumer and investor protection, market integrity, financial stability, and oversight. Submissions are due July 9. (RFI)
Noteworthy Quotes
ADMINISTRATION
Commodity Futures Trading Commission (CFTC)
CFTC Chair Mike Selig posted “Prediction markets have been around since the 1990s, but never before have we had clear rules around which types of events may underpin event contracts. Last week, the CFTC issued a Notice of Proposed Rulemaking to define key terms and determine which contracts serve the public interest.”
CONGRESS
CLARITY Act
On availability of Senate floor time to for passage of the CLARITY Act, Sen. Cynthia Lummis (R-WY) said, “I’m getting worried about it… I wanted to make sure I knew I had 60 votes locked in. But as this thing drags on and people keep bringing up new ideas for amending the bill — it’s just a snowball that will not stop rolling.” (Punchbowl)
Sen. Ruben Gallego (R-AZ) said, “There’s plenty of time. What matters is the actual language,” Gallego said. “You can get it done in the lame duck.” (Punchbowl)
Sen. Mark Warner (D-VA) said, “The calendar is against us.” (Punchbowl)
On her limited role in CLARITY Act negotiations, Sen. Elizabeth Warren (D-MA) said, “Crypto has an industry that is trying to drive the negotiations to exactly the place where crypto wants them. They want a bill that’s good for the crypto industry.” (Punchbowl)
Senate Agriculture Chair John Boozman (R-AR) said of current attempts to merge the Agriculture and Banking versions of market structure legislation, “One of the issues that we have is, a lot of members don’t understand it. In fact, I would say most members don’t.” (Punchbowl)
Similarly, Sen. Thom Tillis (R-N.C.) said, “We’ve got to get everybody back into the muscle memory of short-interval negotiations.” (Punchbowl)
Digital Asset Tax
Senate Finance Committee Chair Mike Crapo (R-ID) said, “I think we need to deal with the issue. We are not at the point where we can announce legislation here, but we are working on the issue. I’m very focused on what the House does.” (Punchbowl)
Sen. John Kennedy (R-LA) said, “We’re having enough trouble in market structure, without adding taxes to it.” (Punchbowl)
Sen. Steve Daines (R-MT) said, “I was working with [Smith] staff-to-staff, and getting an understanding of where the House was. We’re working with the Finance Committee as well, so keeping everybody in line and informed and try to move forward hopefully in a collaborative fashion.” (Punchbowl)
Miscellaneous
Sen. Cynthia Lummis (R-WY) posted “DeFi is not a loophole. It’s a worthy innovation. The Clarity Act treats it that way.”
Lummis also posted “Financial sovereignty means your government cannot inflate away your savings without your consent. That’s what Bitcoin and digital assets protect.”
Lummis also posted “Sound money is the foundation this country was built on. Digital assets give every American access to it again. That is worth protecting.”
Lummis also posted “Our debt is real. Our fiscal trajectory is unsustainable. Bitcoin is one of the few tools that could help right that wrong for younger Americans.”
Lummis also posted “When the Clarity Act becomes law, for the first time, there will be a consumer-friendly disclosure framework for digital assets. Not retrofitted from 1933. Built for 2026 and beyond.”Ways and Means Committee posted “Currently, digital assets are not covered by some anti-abuse rules that apply to traditional assets. The Applying Existing Tax Anti-Abuse Rules to Digital Assets Act closes these loopholes by extending longstanding anti-abuse rules to digital assets, ensuring they are treated the same as similar financial assets under the tax code.”
Ways and Means Committee also posted “Due to uncertainty and high compliance costs, some digital asset owners have unpaid taxes, but are afraid to come forward and report their mistakes. The Digital Assets Voluntary Disclosure Program Act gives taxpayers a clear path back into compliance by offering reduced penalties and a fresh start, helping them correct past mistakes without the fear of burdensome audits or costly enforcement actions.”
Ways and Means Committee also posted “Under current law, digital assets are often not clearly eligible for long standing tax benefits available to traditional assets. The Providing Analogous Rules for Digital Assets Act brings greater parity to the tax code by extending existing safe harbors to digital assets, encouraging investment in U.S. markets and allowing taxpayers to lend digital assets without triggering a taxable event.”
Ways and Means Committee also posted “As written, important tax rules that apply to traditional financial assets do not apply to digital assets. By using a familiar framework that reaches more intuitive results, parity in our tax code would provide consistency and simplicity for taxpayers.”
Rep. Chris Pappas (D-NH) posted “Congress must fully investigate any corruption and inside trading happening in prediction markets. Glad the House Oversight and Government Reform Committee heeded my calls to begin an investigation.”
Rep. Bryan Steil (R-WI) posted “Lawmakers should be writing policy, not wagering on its outcome. I just introduced legislation to prohibit lawmakers from utilizing prediction markets to wager on government policy or political outcomes.”
Sen. Kevin Cramer (R-ND) posted “If the United States doesn’t lead with our values and a light-touch regulatory framework, the crypto industry will move offshore. Democrats may not like having a businessman as President, but we shouldn’t abandon pro-growth, pro-business policies simply because they might benefit President Trump’s family.”
Sen. Adam Schiff (D-CA) posted “Binance has repeatedly routed millions to Iran-backed proxy groups while also being a key backer of Trump’s crypto profiteering. I am demanding answers into Binance’s role in violating sanctions laws — and its business entanglements with the Trump family.”
Senate Special Committee on Aging Hearing on Chinese Harm to Older Americans Q&A
Sen. Tommy Tuberville (R-AL)
Sen. Tommy Tuberville (R-AL): “Mr. Miller, it seems like we’ve either denied it or [agreed] that China is ahead of us in crypto. What’s the consequences of that if we don’t adjust one way or the other?”
U.S.-China Economic and Security Review Commissioner Leland Miller: “So, China has a very interesting mentality towards crypto, in the broader crypto universe. You know, technically crypto is banned in the mainland. But Hong Kong, which is obviously China as well at this point, is a hot bed of crypto innovation. And I think it’s the mindset of the policymakers in Beijing that they can keep the dirtier side of crypto ring fenced away from Mainland China, but they can go into some of the more innovative side of crypto in Hong Kong. I think we need to be keeping a very close watch on this. This is something that our Hong Kong chapter has put particular focus on over the last two years.”
Tuberville: “Are we ahead or behind them? Mr. Hodges, you might wanna—”
U.S.-China Economic and Security Review Commissioner Joshua Hodges: “Yeah. So, one thing to add to that, sir. And again, we haven’t issued this as a formal recommendation or a Committee product yet. But one of the areas where we’ve started to look into is their efforts to use crypto overseas as a method of data collection. It’s very well known that the Chinese apps soak up data. And one thing we’re starting to dig into is their Chinese apps using crypto in third party countries? That’s gonna give them access to those individual’s data. And again, make it harder for the United States to work with those governments or those populaces.”
What I’m Reading This Week
They Looked Like They Were Getting Rich on Polymarket—but None of It Was Real, Katherine Long, Caitlin Ostroff, Neil Mehta and Brenna T. Smith, Wall Street Journal.
Industry Spotlight
On July 16, Injective Summit 2026 will bring together policymakers, global financial institutions, market infrastructure leaders, and innovators shaping the future of digital assets and tokenized markets. To join leaders across policy, finance, and technology in exploring how American leadership can advance responsible innovation and strengthen the competitiveness of U.S. financial infrastructure, apply at https://injective.com/summit.
About Zero One Strategies
Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.
The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.
Contact us at Stacey@ZeroOneStrategies.com
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