Market Structure Bill: Senate Ag Committee Targets Early December Markup

The U.S. Senate Agriculture Committee has released its draft Crypto Market Structure Bill. The proposal seeks to strengthen federal oversight of digital assets by expanding the Commodity Futures Trading Commission’s (CFTC) authority. Lawmakers plan to complete the bill’s framework by year-end, setting the stage for the most comprehensive crypto regulation yet.

Eleanor Terrett reported that Senator John Boozman told Bloomberg that the committee will mark up the Market Structure Bill in early December. The timeline reflects bipartisan urgency to finalize digital asset market rules. 

CFTC Empowered as Senate Refines Market Structure Bill

The 155-page draft characterizes digital commodities as resources that can be transferred without an intermediary and recorded on secure, distributed ledgers. The bill provides the CFTC with regulatory power over such assets. Sens. Boozman and Cory Booker said the bill closes regulatory loopholes that have left consumers vulnerable.

Booker stressed the importance of protecting investors and closing loopholes in the crypto world. The proposal is an extension of the House’s Digital Asset Market Clarity Act, passed in July. The two chambers have now set out to harmonize the frameworks as one single version of the Crypto Market Structure Bill.

The Senate Banking Committee is also marking up similar legislation to delineate oversight responsibilities between CFTC and the Securities and Exchange Commission. That version coins the phrase “ancillary assets” to define which cryptocurrencies are not securities. Its lawmakers plan to combine that with the proposal from the Agriculture Committee for a vote in the Senate.

CFTC Funding Strain and Pending Crypto Rules

Resource constraints at the CFTC continue to be an issue. The agency has about 543 staff members, compared with more than 4,000 at the SEC Booker asked how it could handle increased responsibilities. The draft contains a funding mechanism that would enable the CFTC to charge fees to crypto firms, though there has not yet been agreement on its structure.

Some areas of the draft remain unresolved. Bracketed sections address decentralized finance, anti-money-laundering standards, and broker exemptions. Committee aides said these sections are “seeking further feedback.” Lawmakers expect to resolve the issues before the Market Structure Bill markup begins.

Ethics clauses were included after reports that President Donald Trump had earned profits from several crypto ventures. Lawmakers added provisions aimed at strengthening financial disclosures and avoiding conflicts of interest among public officials who possess digital assets.

Bill Hughes, Senior Counsel at ConsenSys, said that it defends the right of self-custody so users can hold and move digital assets privately. The rule protects developers from classification as money transmitters for releasing blockchain code.

Democrats argue that the Banking Committee should handle developer immunity, raising jurisdictional concerns. The two committees must reconcile their drafts before the Senate can debate.

The Crypto Market Structure Bill is set for an early December markup to determine its trajectory toward a Senate-wide vote. If it passes, the CFTC will have a broader jurisdiction over digital assets.