US Senate Crypto Bill Stalls After Coinbase Opposition, While Russia Advances Retail Access Legislation

US Senate Banking Committee Postpones Vote Amid Industry Split

A crucial hearing to vote on comprehensive cryptocurrency legislation in the US Senate Banking Committee was abruptly canceled after Coinbase, the largest American crypto exchange, withdrew its support hours before the scheduled meeting ^[2].

Coinbase CEO Brian Armstrong publicly stated on X that while the company appreciates the bipartisan efforts of Senate members, "this version would be substantially worse than the status quo" and that "no law is better than a bad law" ^[2]. Committee Chairman Tim Scott confirmed the cancellation but emphasized that negotiations would continue ^[2].

Surveillance Powers Raise Alarm

Galaxy Digital warned that the Senate draft represents the most significant expansion of financial oversight since the USA Patriot Act ^[1]. The bill includes provisions for "special measures" authority that would enable the Treasury Department to designate specific countries, financial institutions, or cryptocurrency transaction types as high-risk for money laundering and restrict them accordingly ^[1].

A particularly contentious element allows a "temporary hold" on transactions, permitting agencies to request that stablecoin issuers and crypto platforms freeze transfers for up to 30 days or longer without court approval ^[1]. The legislation would also bring crypto front ends, including websites and decentralized finance applications, under sanctions and Anti-Money Laundering rules, requiring these platforms to verify wallets and block sanctioned activities ^[1].

Industry Fractures Over Draft Provisions

Armstrong's opposition highlighted deep divisions within the crypto industry ^[2]. Major players including Ripple, Circle, a16z, Kraken, and Coin Center voiced support for the legislation shortly after Coinbase's public rejection ^[2].

Ripple CEO Brad Garlinghouse stated the company remains at the negotiating table and optimistic that differences can be resolved during the legislative process ^[2]. Cody Carbone from the Digital Chamber emphasized the goal of passing legislation in 2026 ^[2].

Coinbase's concerns center on several key areas. The company warned that provisions in the bill could grant the government potentially "unlimited access to financial records" and undermine user privacy ^[2]. Armstrong also expressed concern about stablecoin yield restrictions, which would prohibit issuers from paying direct interest to holders, though third-party providers could theoretically offer rewards ^[2].

Additionally, the Coinbase CEO criticized the bill's regulatory structure, arguing it erodes the Commodity Futures Trading Commission's authority while subordinating innovation to what he characterized as rigid oversight by the Securities and Exchange Commission ^[2]. The first title of the legislation would grant the SEC initial classification authority for certain cryptocurrencies ^[2].

Legislative Path Remains Uncertain

Galaxy Digital CEO Mike Novogratz attempted to ease tensions, reporting conversations with more than ten senators over 24 hours and expressing confidence that legislation would soon pass, noting that delays and tensions are normal in final negotiation stages ^[2].

Despite the setback, prediction platform Polymarket continues to estimate approximately 50 percent probability that crypto legislation will be signed in 2026 ^[2]. Even with Banking Committee approval, the draft would need to be merged with legislation from the Agriculture Committee before votes in both the Senate and House of Representatives, and ultimately presidential approval ^[2].

Russia Advances Retail Crypto Access

In contrast to American legislative gridlock, Russia is preparing to expand cryptocurrency access for everyday investors. State Duma Financial Markets Committee Chairman Anatoly Aksakov announced that draft legislation is ready for the spring parliamentary session ^[3].

The proposed framework would remove digital assets from a special regulatory category and permit non-qualified investors to purchase cryptocurrency up to 300,000 rubles, approximately $3,800 ^[3]. The legislation aims to normalize cryptocurrency within Russia's financial system, treating digital assets as part of "everyday finance" rather than experimental instruments ^[3].

The bill also addresses international dimensions, with lawmakers expecting the framework to support cryptocurrency use in cross-border settlements and enable token issuance in Russia for placement on foreign markets ^[3]. In December, Russia's central bank proposed requiring non-qualified investors to pass risk-awareness tests before trading crypto, while maintaining prohibitions on anonymous and privacy-focused digital assets ^[3].