TD Cowen Warns U.S. Crypto Market Structure Bill May Be Delayed Until 2027 as Political Hurdles Grow

Source: CoinTribune Original Title: TD Cowen Warns U.S. Crypto Market Structure Bill May Be Delayed Until 2027 as Political Hurdles Grow Original Link: https://www.cointribune.com/en/td-cowen-warns-u-s-crypto-market-structure-bill-may-be-delayed-until-2027-as-political-hurdles-grow/

Overview

Efforts to establish clear rules for the U.S. crypto market are likely to take longer than many industry participants expect. An analysis from TD Cowen indicates that while passage remains possible in the near term, political dynamics in Washington increase the likelihood of delays. Approval may not occur until 2027, with full implementation extending to 2029.

Key Points

• TD Cowen’s analysis suggests political dynamics in Congress could delay passage of a U.S. crypto market structure bill until 2027
• Election cycles and Senate vote requirements give Democrats leverage to slow legislation and influence final regulatory timelines
• Conflict-of-interest rules tied to senior officials remain a major hurdle in Senate negotiations
• Even if passed, full implementation of U.S. crypto market rules may not begin until 2029

Congress Weighs Delay on Crypto Market Structure Bill as Elections Near

TD Cowen’s Washington Research Group, led by managing director Jaret Seiberg, stated that Congress has strong political incentives to slow progress. Although a viable path exists for a crypto market structure bill to advance this year, lawmakers may choose to wait, particularly with key elections approaching. Democrats, in particular, may favor delay if they believe control of the House could change after the 2026 midterm elections.

Negotiations, however, have not stalled. Congressional staff from both parties have spent months working through technical language, leaving open the possibility of a faster agreement if political pressure increases. Uncertainty around election outcomes could also push Democrats to compromise sooner rather than later.

Election outcomes are always uncertain, which is why Democrats may cut a deal. That could happen quickly, as staff have been working on the technical language for months. — Jaret Seiberg

Several factors continue to shape the debate over timing:

• Control of Congress after the 2026 midterms remains uncertain
• Senate rules require bipartisan support to advance legislation
• Divisions within the Republican Party could limit vote totals
• Election-year politics tend to discourage major legislative action
• Implementation timelines can be adjusted to meet political objectives

Senate Talks on Market Structure Stall Over Conflict-of-Interest Rules

Disagreements over conflict-of-interest provisions remain a central obstacle. Democrats are expected to push for rules barring senior government officials and their families from owning or operating crypto businesses. Such provisions would likely face resistance unless they are delayed for several years after the bill becomes law.

Recent reports estimated that senior officials have earned substantial sums from crypto-related ventures, including DeFi and stablecoin projects, as well as BTC mining interests. Lawmakers have also raised concerns about memecoins launched in connection with these officials.

One potential compromise would delay the implementation of conflict-of-interest rules for three years after enactment of the bill. According to Seiberg, Democrats are unlikely to accept such a deal unless the rest of the legislation is delayed by several years as well, limiting its immediate effect.

Crypto market structure legislation is widely viewed as the next major regulatory step following the passage of recent stablecoin legislation. A final bill would establish how digital assets are regulated in the U.S., clarify agency oversight responsibilities, and set standards for asset classification. The House passed a version of the bill last year, but momentum has slowed in the Senate, where committees are expected to take up the issue later this year.

Senate Delays Extend Uncertainty for Crypto Firms Awaiting U.S. Market Rules

Passing the bill through the Senate presents another challenge, as it requires 60 votes to overcome a filibuster. Even with unanimous Republican support, at least seven Democratic votes would be needed. In practice, support from eight or nine Democrats may be required, as some Republicans are expected to vote against the measure.

That vote arithmetic gives Democrats a greater ability to delay progress. A postponed vote could shift implementation beyond the next presidential term, allowing regulators appointed by a future administration to shape final rules. Similar delays have occurred before with other legislation, which includes extended implementation periods.

Key consequences of a delayed timeline include:

• Rules taking effect under a different administration
• Greater influence for regulatory agencies over final standards
• Extended uncertainty for the crypto industry
• Reduced urgency to reach compromise before elections
• Increased focus on political positioning rather than legislative speed

Crypto firms generally want the legislation in place as soon as possible, and many appear unconcerned about certain provisions. That gap between industry priorities and political incentives continues to drive tension around the bill. Policy analysts broadly expect a crypto market structure bill to pass in 2026, though enforcement may still be several years away.