Michael Novogratz, CEO of Galaxy, has revealed that the crypto bill to regulate the crypto industry could be finalized within the next few weeks. However, unlike Coinbase’s CEO, the legislation doesn’t need to be perfect to move forward.
The long-awaited US crypto market-structure bill has been met with fresh turmoil, as industry leaders and lawmakers call it imperfect. Yesterday, Coinbase CEO Brian Armstrong announced that the exchange can no longer support the latest Senate Banking Committee draft due to its imperfections.
However, Michael Novogratz says that the issues can be sorted later on as long as the bill is passed.
Novogratz: "Pass the bill, we will fix it with time"
The negotiations began to fall apart around the treatment of stablecoin rewards. Banking groups have sharply criticized the GENIUS Act, a stablecoin law that passed over the summer. Although the law bars issuers from paying direct interest to stablecoin holders, it does not prohibit third-party platforms such as Coinbase from offering rewards.
In response, crypto industry leaders interpreted it as banks trying to curb competition and noted that stablecoin yield had already been debated during the summer.
Armstrong warned that the bill would effectively ban tokenized equities, impose sweeping DeFi surveillance, erode the CFTC’s authority in favor of the SEC, and “kill” rewards on stablecoins and the role of the Securities and Exchange Commission. He stated that he would rather have no bill than a bad bill.
“The current draft text that was shown to us earlier this week, for instance, would kill probably three or four different product lines that we have already in market [..] And so if this is going to be a giveaway to the banks, I’d rather just stick with GENIUS, which is already in law and we are able to operate our business just fine in that environment,” Armstrong said.
After Coinbase made its stand public, the banking committee cancelled its markup hearing, pushing it to a later date that has not yet been scheduled.
On the other hand, Novogratz says that the industry needs to move. He stated, “I do think there will be a compromise on this […] I don’t think it will be great for crypto, but I think it’ll be fine. And for me, I just keep saying, we got to get this bill passed so we can move on, and the industry can start growing […] And if it’s not perfect, who cares? We’ll fix it in time.”
Senate Democrats Try to Revive the Bill as the Market Goes Neutral
Senate Democrats have not closed the door on reviving the stalled crypto market structure bill, with negotiations reportedly set to resume between lawmakers and industry leaders today.
According to sources, representatives from both the Senate Banking Committee and the Senate Agriculture Committee are scheduled to hold a call with crypto industry executives to discuss next steps for the legislation. The report said that both sides coming back to the table suggests the bill remains under active consideration, despite recent setbacks.
The Crypto Fear & Greed Index dropped 11 points to 50 on Friday, sliding from “greed” to “neutral” in less than 24 hours as debate over the crypto bill intensified. Traders have grown cautious while lawmakers struggled to keep their legislative calendar on track.
The index was at 61 on Thursday, which was the highest level since October 10. On that same day in October, the larger crypto market experienced nearly $19 billion in liquidations. During Thursday’s rally, Bitcoin climbed roughly 5% to $97,870. Now the coin has declined over 1% as the broader market shed 0.8% of its market cap.