The U.S. senators negotiating the crypto market structure bill have rarely been so openly eager to find a bipartisan solution for that legislation. Even as political noise and clashes with President Donald Trump rage around them, lawmakers and staffers have met for an earnest series of talks seeking to hash out the industry's regulatory destiny in the U.S.

Despite this increasingly rare bipartisan exercise and the confidence expressed by some of the leading players, the unresolved details of the legislation are significant, and some of the coming headwinds are out of their hands.

After the House of Representatives cleared — for the second time in recent years — a bill to set up a regulatory regime for the crypto markets, the Digital Asset Market Clarity Act, the Senate snatched that baton and got to work on a parallel effort. To the frustration of House lawmakers, they declined to simply take up the Clarity Act and revise it, but instead worked on their own similar-but-distinct take.

Now, that work has slipped into January, as decided by Senate Banking Committee Chairman Tim Scott, who gathered crypto representatives and fellow lawmakers again this week to have another end-of-year chat about next steps. Even with all this cooperative energy, nothing is ever certain in Congress.

First, in January, the process could run up against Congress' next deadline, January 30, for sorting out a federal spending plan. The last time the lawmakers were pressed to work out a budget compromise, they ended up shutting down the government for weeks. If that were to happen before resolution on this crypto bill, it could again delay the work for another uncertain period of time and force the participating lawmakers to shift focus elsewhere.

The later into 2026 this effort drifts, the more pressure from the midterm elections increases, which could leave previously cooperative lawmakers less willing to go along. The lawmakers will have to weigh what open cooperation with the crypto industry means for their constituents, their political alliances and for campaign fundraising. And more broadly, if Democrats believe they'll take back control of the House, and potentially even the Senate, they'll have to decide whether it's worth waiting until that shift so they can have a stronger voice in potential crypto policy language.

Gavels change hands?

The House shifting toward Democratic control — a possibility set now at 78% in Polymarket wagering — could put the gavel of the House Financial Services Committee back into the hands of Representative Maxine Waters, the California Democrat who had led the panel before. While she's conducted serious negotiations with her Republican counterparts on crypto bills, the committee only began strong progress on advancing digital assets legislation after Republicans took over — first Patrick McHenry, and currently French Hill. It's uncertain how Waters, who has been strongly critical of recent legislative efforts and of Trump's personal crypto ties, would proceed with a potential do-over on market structure.

However, the deeper nightmare scenario for crypto insiders would be that longer-odds shift to a Democratic Senate, which could leave industry critic Senator Elizabeth Warren as chair of the Senate Banking Committee. For years, the presence of progressive Democrat Sherrod Brown atop that committee meant a roadblock for U.S. crypto policy. While the Senate seats that are open to election in 2026 tend to favor Republicans maintaining their narrow majority, the tide is on the Democratic side for some electoral upsets in November.

If Democrats win committee gavels in either the House or Senate, crypto legislation and the oversight of the crypto approach at the federal regulators will get a new level of scrutiny and criticism. And they can control the legislative agendas of panels that the industry needs on their side.

But the political calculus for crypto decisions has shifted markedly with the influx of immense amounts of campaign cash that really began shifting congressional elections in 2022 and 2024. The biggest of the industry's political action committees, Fairshake, is already standing by with an unrivaled warchest of well over $100 million, according to federal disclosures. Every congressional candidate will have to face the question: Will my crypto position result in potentially millions spent to bolster my opponents or millions spent to get me elected?

Even if Democrats win, many in their party are already in favor of friendly crypto policies, and more could arrive after Fairshake and other PACs have their say next year.

Repeating the rarity

This is a political era in which standalone, bipartisan legislation seems a relic of the distant past, which made the accomplishment of this year's Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act a highly unusual moment. The crypto industry hopes to repeat that win on a much larger scale, and if it were to be done in the next few months, Democrats may have to find ways to make painful compromises.

One of the most high-profile points of friction is the ethics component driven by Democrats. They want to head off the conflicts of interest threatened by Trump's personal financial involvement with the crypto industry, such as the family stake in World Liberty Financial Inc. The Democrats have asked for a ban of such relationships involving government officials, but the White House has already rejected early efforts on that front.

Another of the tricky territories, the bill's treatment of decentralized finance (DeFi), could blow up in either direction, sending either Democrats or the industry itself packing. Democrats want some kind of regulation of DeFi akin to other financial firms, while the industry is concerned that certain requirements could be existential threats that implode the space. It's been held up as a potential deal breaker by both sides.

Plus, Democrats have pushed for people from their party to be guaranteed the vacant spots at the SEC and CFTC — an uncertainty as Trump continues to strip Democrats from regulatory roles all across the government. And the Democratic negotiators have resisted the idea of stablecoins issuing yield or rewards, defending the role of traditional bank deposits.

People familiar with the Senate's gathering of industry insiders on Wednesday said Coinbase is among those arguing in favor of reward programs to incentivize adoption, and the Blockchain Association (along with dozens of other organizations) sent a letter to Chairman Scott on Thursday saying that getting back into this topic that was addressed in the GENIUS Act "would reopen a settled issue, undermine a carefully negotiated compromise, reduce consumer choice, suppress competition, and inject uncertainty into the implementation of a new law before regulations have even been proposed."

Faster, please

A separate letter this week from three of the most influential crypto associations in Washington — the Digital Chamber, Blockchain Association and Crypto Council for Innovation — requested Chairman Scott release a draft of the current bill in the opening days of January and set a solid date for a formal markup of that bill, meaning the process in which lawmakers offer amendments and work to advance a bill toward the floor.

All of that may ultimately hinge on the willingness of several of the Democrat negotiators to agree to some lesser version of the ethics standard and some approach to DeFi that could leave them uneasy.

Dennis Porter, who runs the Satoshi Action Fund and has been inside discussions on the legislation, said it's possible the threat of looming midterms is used as a "boogie man" to urge faster negotiations.

"We should keep in mind that major, comprehensive legislation regularly passes in the final months before elections," he said. "Dodd-Frank [Act of 2010] passed four months before midterms. Inflation Reduction Act [of 2022] passed three months before midterms."

Of course, political calculations may deliberately undermine the bill, too, with Republicans looking forward to crypto-industry campaign support and Democrats brimming with confidence that their star is rising.

"Both sides might decide to settle this at the ballot box," Porter said. "More than likely, Democrats at least take the House."

It remains possible that the long-awaited legislation fails to find its way in 2026. So what happens then? The answer is — for crypto firms — a less satisfying and less durable system of policy changes directly instituted by regulators, using their current interpretations of the authorities their foundational laws give them. For instance, while former Securities and Exchange Commission chief Gary Gensler may have seen the law as backing his view that most crypto assets were securities, the agency's current head, Paul Atkins, has a nearly opposite opinion.

So Atkins and his counterpart at the Commodity Futures Trading Commission are pushing forward with new policies that clarify oversight of the space and try to lend clarity. But without explicit new law behind them, specifically tailoring their authorities with digital assets, new policies today can more easily become rejected policies in a few years.

Cody Carbone, the CEO of the Digital Chamber, circulated a note after the Wednesday meeting, at which senators from both parties heard from industry leaders, saying the talk was "positive and collaborative," though the negotiators have "significant policy issues to iron out."

The new year will begin with a high-stakes return to the negotiating table.