- US Democrats are considering a new crypto market structure bill that could expand the SEC’s regulatory powers and revive investor protection measures.
- The proposal may introduce stricter rules for crypto companies, including separate customer funds, faster withdrawals and regular proof-of-reserves reports.
- The discussions could reopen the stalled CLARITY Act debate, but no formal bill or timetable has been announced.
U.S. Democrats are considering a new bill aimed at re-shaping the crypto market landscape. This may give the SEC more regulatory powers over the sector and include provisions that have previously been rejected.
The bill comes after the Democrats won key victories in the November 3 midterms. It will now be interesting to see how crypto regulation evolves. However, no formal bill has been released and there are still several key details to be decided.
Democratic lawmakers want to expand on the previous proposals from Representative Maxine Waters known as the ‘Crypto Investor and Consumer Bill of Rights’.
🚨SCOOP: House Democrats are discussing plans to expand the Crypto Investor and Consumer Bill of Rights, @RepMaxineWaters’ amendment to the Clarity Act in 2025, into a broader crypto “market structure” bill next Congress.
The proposal would fold in Democratic Clarity Act provisions originally offered by Waters in the House (which were not adopted), as well as provisions Senate Democrats were able to agree to with Republicans before the September cloture vote, according to three industry sources who have spoken with Democratic staffers.
Some of the proposals under discussion are said to include giving the @SECGov more of a role in supervising the crypto markets, and a more limited role for the @CFTC. Additionally, it’s likely that further ethics provisions will be offered to restrict the crypto activities of President Trump and other federal officials.
Republicans are calling this a “messaging bill.”
— Eleanor Terrett (@EleanorTerrett) November 4, 2026
The bill includes a range of provisions such as segregating customer funds, fulfilling withdrawal requests within 24 hours, releasing monthly proof-of-reserve statements which have been independently audited. It also includes protection from front running which is taking advantage of insider knowledge by traders and 24/7 customer service.
Waters had proposed this in 2025 when the CLARITY Act was being debated in the House. However, the changes were not included in the finalized act.
Some investor protection provisions may also be considered in the new talks. This includes provisions previously negotiated between Democratic and Republican senators. However, they failed to get enough votes (the 60 votes needed) in September and the CLARITY Act has stalled.
Proposed Bill Could Expand SEC’s Regulatory Powers
One major change to consider under the new bill is the regulatory powers given to the SEC and CFTC. Democrats are looking to increase the SEC’s role in crypto markets and reduce the CFTC’s role. This contrasts with the CLARITY Act that was passed by the House which gave the CFTC the leading role in regulating digital commodities.
Restrictions on Trump’s Crypto Activities Also Discussed
Democrats are also discussing potential restrictions to crypto transactions made by President Donald Trump and other federal officials. Waters had previously proposed the Stop TRUMP in Crypto Act which would restrict certain digital asset transactions made by congress members and their families. However, it is unclear if this will be included.
Republicans have said that the proposed legislation is more of a PR stunt. There is also no full draft of the bill yet. The main focus of the debate is around legislation that can be considered by the next Congress starting in January 2027.
Democrats may have a stronger voice in crypto regulations following the election results on November 3. Waters may also return to her role as chair of the House Financial Services Committee.
Ripple’s CEO Brad Garlinghouse has said he is pleased to see both parties supporting pro-crypto candidates. He has called for clear crypto regulations in the U.S. Ripple’s Chief Legal Officer also urged both sides of lawmakers to work together to create practical digital asset regulations.
CLARITY Act Remains Stalled Amid Political Changes
There are several new lawmakers from both parties who have previously supported crypto related legislation. However, it is unclear when the proposed bill will be introduced and there is still no date set for the CLARITY Act to be voted upon in the Senate.
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