TLDR
Bipartisan discussions give a 50-60% chance for crypto bill passage in 2026.
Stablecoin regulation remains a flashpoint between banks and crypto advocates.
SEC-CFTC jurisdiction allocation still unresolved in the crypto bill discussions.
Leadership instability at CFTC complicates the path for broader crypto regulation.
With the 2026 midterm elections looming, Congress faces a critical test in passing a sweeping cryptocurrency regulation bill. While bipartisan talks offer hope, key issues such as jurisdiction disputes between the SEC and CFTC, stablecoin regulation, and potential conflicts of interest surrounding President Trump’s family crypto ventures threaten to derail progress. Can lawmakers reach an agreement before the election season shifts their focus? The stakes are high for both industry and government.
Midterm Elections and Legislative Pressure
As 2026 approaches, a crucial moment for cryptocurrency regulation is on the horizon. The U.S. Congress is working to pass an all-encompassing crypto bill before the midterm elections, which could impact the bill’s prospects. Discussions between both major political parties have led to some optimism, but the clock is ticking.
The bill, which aims to regulate digital assets, has a 50-60% chance of success in 2026, according to advocacy sources. However, the tight legislative timeline, compounded by the looming midterm elections, raises questions about whether lawmakers will act before shifting focus to election-related priorities.
Crypto advocacy sources who spoke with The Block gave a range of 50% to 60% chance of such a bill becoming law in 2026.https://t.co/FHclOE7QJb
— Sarah Wynn (@ForTheWynn_) December 24, 2025
The Senate Banking Committee has drafted a version of the bill that addresses jurisdictional issues between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). This bill has been the subject of ongoing negotiations, with both parties striving for compromise. However, a critical deadline looms, as negotiations must be finalized early in 2026 to avoid delays that could push the bill into the uncertainty of the election year.
Key Points of Contention
Several issues still need resolution before the bill can move forward. A primary area of disagreement is how to regulate yield-bearing stablecoins. Banking groups argue that the current laws fail to close loopholes in the regulation of stablecoin interest offerings, which they fear could transform stablecoins into financial products rather than simple payment tools.
On the other hand, crypto advocates contend that allowing yield on stablecoins is simply a matter of healthy competition in the financial sector. These opposing views have created a stand-off that could delay the overall progress of the bill.
In addition, the role of the SEC in regulating certain tokens is another sticking point. Some crypto industry leaders are concerned that the SEC, which has historically taken a more cautious approach toward crypto, could end up with too much authority. “It is very worrisome to have legislation that says the SEC will be the first decision maker,” said Cody Carbone, CEO of The Digital Chamber. The concern stems from a fear that the SEC’s broader influence could lead to more restrictive rules for the industry, echoing the policies of former SEC Chair Gary Gensler.
Conflicts of Interest and CFTC Leadership Issues
Another complication in the push for a crypto regulation bill lies in potential conflicts of interest involving President Donald Trump’s family ventures in crypto. Trump’s family has been involved in several crypto projects, raising questions about possible ethical concerns in the drafting of the bill. This issue is significant enough to influence discussions and has drawn attention from various lawmakers, who have sought to address it through legislative language.
At the same time, the lack of a stable leadership team at the CFTC has further complicated the situation. With multiple commissioners having departed, the agency has been left in a state of flux. This instability is seen as a hurdle for broader CFTC jurisdiction, which some lawmakers argue is necessary for effective crypto regulation. As the CFTC grapples with its leadership issues, some Democrats have used the situation to press for more influence over the regulation of digital assets.
The Path Ahead
Looking ahead, the path to passing a sweeping crypto regulation bill in 2026 remains uncertain. While the Senate Banking Committee has made progress, unresolved issues regarding stablecoins, SEC-CFTC jurisdiction, and leadership challenges at the CFTC continue to pose significant hurdles. Furthermore, the risk of a government shutdown in 2026 could halt legislative work entirely, further tightening the timeline.
Despite these challenges, advocates for cryptocurrency regulation remain hopeful that bipartisan efforts can lead to a compromise. For now, the fate of the crypto bill rests in the balance as the clock ticks down to the midterms and potential legislative delays.
