“HEAVY REGULATION, LIGHT INNOVATION.”
Is Washington Slowing Crypto Progress by Ignoring Industry Warnings? The US Senate Banking Committee’s January 15, 2026, markup of legislation pertaining to the structure of the cryptocurrency market was suddenly postponed.
One of the biggest digital asset exchanges in America, Coinbase, unexpectedly stopped providing service, which caused the delay.
The law faced opposition by Coinbase CEO Brian Armstrong, who warned that it could stifle US digital currency innovation. He said that the plan places significant restrictions on decentralised finance (DeFi), limits stablecoin payouts, and runs the risk of a “de facto ban” on tokenised stocks.
Most importantly, Coinbase said that the measure marginalises the Commodity Futures Trading Commission while giving the Securities and Exchange Commission undue authority.
Lawmakers were taken aback by the change. The departure of Coinbase exposed significant divisions within the digital asset industry and dashed hopes for bipartisan progress. The bill’s progress rapidly fell apart in the absence of support from an important industry participant.
Leaders of the Senate Banking Committee decided to remove the markup rather than force a contentious vote.
Legislators now acknowledge that the bill needs significant changes and does not have enough industry support. Stakeholder discussions are scheduled to pick back up.
The delay highlights Washington’s increasing difficulty in regulating cryptocurrency without stifling innovation. Critics caution that hasty regulations could force blockchain development offshore as global competition heats up.
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