Democratic unity against crypto legislation is breaking. Senators Ruben Gallego and Angela Alsobrooks joined all 13 Republicans on the Senate Banking Committee to advance Senator Cynthia Lummis's Digital Asset Market Clarity Act in a 15-9 vote.
The bill isn't just a labeling exercise. It creates a definitive regulatory path, splitting oversight between the SEC and CFTC, and includes a strict, code-based definition of decentralization. A key provision, the bipartisan BRCA amendment, protects non-custodial developers from being treated as banks. On Bankless, Ryan Sean Adams argued this is a red line for the industry, preventing the government from targeting individual coders for a protocol's actions.
"The text includes a detailed definition of decentralization that requires permissionless code and distributed voting power."
- Ryan Sean Adams, Bankless
Ranking Member Elizabeth Warren led the opposition, framing the act as crypto industry-written legislation that weakens investor protections dating back to 1929. She proposed 16 amendments during the markup, targeting crypto mixers and seeking to block illicit stablecoin flows. None passed.
The legislative path now involves merging this text with a separate bill from the Agriculture Committee. While Chairman Tim Scott framed the act as a turning point to protect consumers and foster innovation, David Bennett on Bitcoin And suggested the internal Democratic split is the more consequential story for the industry's long-term survival than the regulatory details.
"Senators Ruben Gallego and Angela Alsobrooks joined all 13 Republicans to move the bill to the full Senate. Host David Bennett argues this marks a significant shift in party power, as senior Democrats are no longer voting in a monolithic bloc against digital assets."
- David Bennett, Bitcoin And
The momentum signals a shift. Warren's failure to rally her colleagues suggests her anti-crypto coalition is losing its grip, even as she warns the bill declares open season on defrauding consumers. The bill now moves toward a full Senate floor vote.
