House Democrats float crypto market bill with SEC at the wheel

House Democrats have started discussing a crypto market-structure bill for the next Congress, and the early outline hands the SEC a bigger supervisory role, according to crypto.news’s Eleanor Terrett. The proposal would grow Waters’ Crypto Investor and Consumer Bill of Rights amendment, her 2025 CLARITY Act addition, into a broader market-structure plan. It would also pull from Democratic amendments filed during the House’s CLARITY Act work and from provisions Senate Democrats and Republicans negotiated before September’s failed procedural vote.

Under the ideas in the report, the SEC would get a larger supervisory remit while the CFTC’s scope would shrink. Ethics provisions would likely address the crypto activities of Trump and other federal officials. Republicans have described the effort as a “messaging bill,” according to the report.

Waters’ amendment 31, listed in the House Rules Committee record, carries the consumer-protection details. Covered businesses would have to process cash withdrawals or digital asset transfers within 24 hours unless a documented, good-faith fraud concern exists. Human phone or live-chat support would run nonstop, with connection waits capped at five minutes.

Customer assets would be segregated in bankruptcy-remote accounts, and lending, staking or reusing them would need affirmative consent that customers could revoke. Firms holding customer assets would publish cryptographically verifiable reserves at least monthly, plus an attestation from a licensed public accountant. They would need to report a security breach affecting customer assets or personal information within 48 hours.

A second Waters amendment, numbered 30, incorporated the Stop TRUMP in Crypto Act, which targets crypto conflicts involving the president, vice president, members of Congress and their immediate families. The Rules Committee rejected a motion to make the investor-protection amendment eligible for consideration by a 4–8 vote. That vote was about whether the amendment could be considered, not final passage of a standalone investor-protection law.

The Republican-led CLARITY framework would put the CFTC in charge of covered spot digital commodity markets while keeping SEC jurisdiction over securities and investment contracts. Its final pre-vote text added registration routes for digital commodity exchanges, brokers and dealers, and sponsors said it took in 126 substantive changes requested by Democratic negotiators. The Senate’s September cloture vote failed 49–50, short of the 60 needed to proceed; Sen. Thom Tillis switched to no for procedural reasons, leaving room to seek reconsideration. Former CFTC Chairman J. Christopher Giancarlo later said both agencies could keep building digital asset frameworks under existing authority.