Legislative Hearing Delayed Due to Unresolved Stablecoin and DeFi Issues
Senator Tim Scott has postponed the Senate Banking Committee's hearing on the Crypto Market Structure Act. This decision stems from unresolved disagreements concerning stablecoin yields and restrictions within decentralized finance (DeFi) protocols, impacting the legislative process for cryptocurrency market regulation.
The postponement has led to immediate market reactions, with both Bitcoin and Ether experiencing a price drop of approximately 2%. This decline highlights the market's sensitivity to regulatory uncertainty and the potential impact of legislative developments on cryptocurrency valuations.
Stablecoin Yields Emerge as a Key Obstacle to Legislation
Alex Thorn reported that Senator Tim Scott has rescheduled the Crypto Market Structure Act hearing, which was originally planned for the current week. A primary reason for this delay is the ongoing debate surrounding stablecoin yields. Banking industry lobbying groups have voiced concerns, advocating for limitations on stablecoin rewards. These groups argue that such rewards could deplete traditional bank deposits and pose risks to overall financial stability.
The market responded swiftly to the news of the hearing's postponement. Bitcoin and Ether both saw a 2% decrease in value following the announcement. This market movement underscores the persistent volatility in the cryptocurrency sector, which is often exacerbated by regulatory uncertainty.
Industry Figures React to the Senate's Decision
Several prominent figures in the cryptocurrency industry have commented on the postponement. David Sacks, a key figure in the White House's crypto initiatives, expressed a continued commitment to establishing a regulatory framework. He stated,
Passage of market structure legislation remains as close as it’s ever been. Now is the time to set the rules of the road and secure the future of this industry.
Brian Armstrong, CEO of Coinbase, conveyed his disappointment regarding specific aspects of the bill, particularly those related to privacy, DeFi, and stablecoin rewards. His concerns led to Coinbase withdrawing its support for the bill in its current form.
Market Impact on Bitcoin and Ether
The current delay in crypto legislation hearings is reminiscent of previous postponements, including the pivotal GENIUS Act from the previous year. The regulatory uncertainties surrounding stablecoin yields today echo the controversies of that time.
As of January 17, 2026, Bitcoin (BTC) was trading at $95,166.01, with a market capitalization of $1.90 trillion. The 24-hour trading volume for Bitcoin had decreased by 44.91%. While the price saw a moderate decrease of 0.47% over the past 24 hours, it had risen by 5.06% over the preceding week.
Analysis from Coincu Research suggests that ongoing regulatory ambiguity could potentially lead to disruptions in the financial sector and significant shifts within DeFi protocols. The central issue of stablecoin yield restrictions remains a critical point, with potential legislative outcomes poised to influence the broader cryptocurrency ecosystem. Further details on the legislative challenges can be found in Senator Scott's statement regarding the market structure markup discussion.