After years of waiting, the Senate's crypto market-structure bill is apparently almost ready. Senators told industry attendees on Tuesday that bipartisan talks have picked up speed and a draft could land by the end of the week. There's just one problem: the White House looked at their proposed ethics rules and basically said "try again."

Racing Toward a Draft

Sens. Kirsten Gillibrand (D-NY) and Cynthia Lummis (R-Wyo.) addressed the Blockchain Association Policy Summit in Washington with news that negotiations have accelerated. They're targeting a draft release by week's end and a committee markup next week. Gillibrand emphasized that recent sessions between Democrats and Republicans have been productive, declaring that "nothing is holding up this bill."

The momentum reflects mounting pressure from Bitcoin (BTC) and the broader crypto industry for clearer regulatory boundaries, especially as institutional players pile into the space. The House already passed its version, the Digital Asset Market Clarity Act, back in July, so the Senate is playing catch-up.

Right now, two parallel drafts are moving through the Banking and Agriculture Committees. One would split oversight between the SEC and the CFTC while introducing "ancillary assets" as a term to identify which cryptocurrencies wouldn't be treated as securities. A separate Agriculture Committee draft from last month focuses on expanding the CFTC's authority over the market.

The Ethics Problem

Here's where things get interesting. Gillibrand said the Senate version aims to tackle issues the House bill ignored, including how to regulate decentralized finance exchanges. Democrats handed Republicans their final list of changes Monday evening. But one section has become a political hot potato.

Lummis revealed she worked with Sen. Ruben Gallego (D-AZ) on an ethics proposal that would prevent elected officials and their families from issuing or profiting from digital assets while holding office. The White House shut it down.

"The White House kicked it back and said, you can do better than this," Lummis told the summit, adding that she plans to revise and resubmit the language.

The timing isn't accidental. Ethics rules have become politically charged after reports that President Donald Trump and his family generated substantial income from ventures connected to the World Liberty Financial (WLFI) DeFi and stablecoin platform. When your crypto bill has to navigate around the president's family business interests, negotiations get complicated fast.

Three-Dimensional Chess

Lummis described the negotiation process as "three-dimensional chess" involving Democrats, Republicans, industry participants, and the administration all at once. That's a rosier picture than Sen. Bernie Moreno (R-Ohio) painted earlier in the week when he called discussions "decently frustrating."

Still, industry observers think something could actually happen. Cody Carbone, CEO of The Digital Chamber, told The Block that there's still a window for market-structure legislation to reach President Trump in early 2026 if committees can advance a draft this week. Progress on markups would signal that Congress is finally ready to deliver the bill investors have been waiting years to see.

Whether the revised ethics language satisfies the White House remains the biggest question mark in a process that's already juggling regulatory turf wars, partisan politics, and an industry desperate for clarity.