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A bill drafted by the Senate Banking Committee could transform the regulatory landscape for crypto-asset companies by providing the framework long sought by the industry.
The Responsible Financial Innovation Act of 2025 would establish a national regulatory framework for crypto-assets by handing responsibility for their oversight to the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC).
The CFTC would be responsible for digital assets whose blockchain is “functional” and “decentralised”, and which are therefore classified as “digital commodities”. The SEC would be responsible for all other crypto-assets.
The draft bill would also establish an Independent Financial Technology Working Group to Combat Terrorism and Illicit Financing, which would consist of the Secretary of the Treasury and senior representatives from other federal agencies.
The working group’s role would be to study how digital assets might be misused for illicit purposes and to recommend coordinated policy responses, ensuring that the new crypto framework does not weaken anti-money laundering and counter-terrorist financing (AML/CTF) safeguards.
Under the bill, the Board of Governors of the Federal Reserve, the Office of the Comptroller of the Currency (OCC), and the Chair of the Federal Deposit Insurance Corporation (FDIC) would be obligated to set regulatory capital requirements for insured depository institutions, depository institutions, bank holding companies and non-bank financial companies under their jurisdiction. They would be required to do so within 360 days of enactment.
The bill contains protections for decentralised finance (DeFi) users who run validator nodes, contribute to liquidity pools, develop messaging protocols or build wallets or key-management systems. However, these would not apply to protocols that can be materially altered by a single actor or group (i.e., centralised protocols).
House Republicans passed a similar measure, the Digital Asset Market Clarity Act of 2025 or CLARITY Act, in July.
Congressman French Hill, who piloted the CLARITY Act through the House, said: “Digital assets and blockchain technology are driving the next evolution of the internet. This technology empowers individuals, spurs innovation, and creates new economic opportunities.”
The crypto industry is strongly in favour of the legislation, which would give it the regulatory clarity it has long sought.
The bill is an attempt by US lawmakers to create a regulatory framework for crypto markets that have previously been regulated largely via enforcement actions.
It comes as other jurisdictions, such as the EU and Singapore, have brought in clear regulatory regimes for digital assets.
Roadblocks ahead
The bill may encounter roadblocks from Democrats, as well as the influential Republican Senator John Kennedy of Louisiana, who has stressed the need to get the bill right and not rush it.
Senator Elizabeth Warren said on September 9, 2025, that a new crypto regulatory regime requires legislation that can pass both the House and the Senate.
“I put forward a framework for legislation in July, and today more Democrats released their framework for crypto market structure legislation. So far, instead of working with us, Republicans have produced two partisan drafts - including a recent proposal that reportedly reflects secret feedback from industry and other stakeholders that Republicans refuse to share with Committee Democrats, or the public,” said Warren.
“To succeed in passing a new law, the Majority must share stakeholder feedback publicly and work with Democrats on strong bipartisan legislation that addresses the real and serious concerns with their current industry-written proposals.”
Fate uncertain
If passed, the bill would be the most significant legislation for the crypto industry since the GENIUS Act introduced a clear regulatory framework for stablecoins earlier in the year.
It is intended to give the sector the regulatory certainty it needs to enter the mainstream of financial services, shifting governance away from piecemeal, state-by-state enforcement to a nationwide regime.
The bill’s proponents hope that if passed it will encourage innovation and investment and allow a move away from enforcement-led regulation.
However, its fate hinges on whether the Senate can agree on a bipartisan version that balances innovation with investor protection. The US appears to be moving towards a comprehensive regulatory framework for crypto-assets, but its precise shape remains to be determined.
