White House accuses Democrats of ‘bad faith’ over delayed crypto bill vote

As the crypto industry continues to digest the abrupt postponement of the Senate Banking markup of the crypto market structure bill, different quarters have expressed mixed feelings on contentious issues. 

According to the White House, however, Democrats were acting in “bad faith” and were ready to gut the bill even before the markup was delayed. 

In a statement, Patrick Witt, Executive Director of the President’s Council of Advisors for Digital Assets, said 

“Senate Banking Democrats were prepared to vote unanimously against a bipartisan bill that included so many concessions to them that it ultimately cost industry support. Bad faith.”

Crypto bill delay elicits mixed views

Coinbase CEO Brian Armstrong pulled support for the draft just hours before the initial schedule on 15 January. 

He said the text had “too many issues,” including stablecoin rewards limitation and a de facto ban on tokenized equities. According to him, the current status quo is way better than the text, adding that they’d rather have “no bill better than a bad bill.”

In a separate interview with CNBC, Armstrong reiterated, 

“The high-level principle is that you can’t really have banks come in and try and kill their competition at the expense of the American consumer.”

He added that the delay could offer a window to improve the bill. 

However, policy analysts such as Jake Chervinsky, CLO at crypto VC Variant Fund, proposed removing one of the contested issues, the tokenized securities, from the bill to improve the odds of passage. 

Source: X

Industry reportedly split on way forward

On the contrary, Miles Jennings, Head of Policy and General Counsel for VC firm a16z, disagreed with Chervinsky’s proposal and view that the SEC will not have oversight authority in the industry. 

“No one was proposing to make this trade. Nothing in market structure prevents tokenized securities. Simply restating the law does not change the law.”

In fact, reports claim that Ripple and a16z didn’t share Coinbase CEO Armstrong’s bold opposition to the bill. The two, alongside Coinbase, are the largest donors to crypto super PAC Fairshake.  

That said, there is speculation that the Senate Banking Committee could do the markup before the Senate Agriculture Committee (Handling the CFTC and commodities side of the bill), which also pushed its process to the last week of January. 

However, at press time, there was no consensus on the timeline. The bill seeks to offer sweeping regulatory clarity on asset classification, oversight mandates between the SEC and CFTC, investor protections, and more. 

Final Thoughts

• The White House slammed Democrats, adding that they were ready to block the bill even before the markup was postponed. 
• Crypto industry leaders reportedly split on Coinbase’s strong opposition to the bill as the next markup timeline remains unclear.