Why Wall Street says ‘no bill is better than a bad U.S. crypto bill’

Industry players have pushed back strongly against the recently released draft of the crypto market structure bill, which lawmakers scheduled for a vote earlier this week.

Although the bill aims to deliver long-awaited regulatory clarity, it has failed to win broad support across the sector.

The legislation aims to define how digital assets are classified and clarify the roles of regulatory agencies in overseeing the space. It also seeks to outline which products and services crypto companies can legally offer, while prioritizing consumer protection for U.S. citizens.

The industry has reacted far more critically to this bill than to earlier crypto legislation, such as the GENIUS Act, which established a stablecoin framework and won broad support.

Why the pushback?

Hunter Horsley, CEO of Bitwise Asset Management, said regulators have made progress in supporting the crypto industry, but they still leave major clarity gaps.

Speaking to CNBC, Horsley highlighted concerns about the bill. He pointed out that certain provisions, such as restrictions on asset tokenization and the ban on stablecoin rewards, pose significant challenges.

He added that there is strong interest from large institutions, including Bitwise clients, banks, wealth management firms, and hedge funds, all of whom need clearer regulatory language around DeFi.

Horsley emphasized that the situation is no longer driven solely by the crypto industry. Traditional financial institutions are now actively looking to bring their clients into the ecosystem, a shift he believes may be influencing the structure and direction of the current bill.

He concluded by stressing that the outcome of this bill is not a “make or break” moment for crypto, adding that innovation in the space will continue regardless.

Coinbase CEO also pushes back

Coinbase CEO Brian Armstrong has echoed similar concerns, stating that “no bill is better than a bad bill,” as the company withdrew its support for the current version of the legislation.

Armstrong acknowledged that while some elements of the bill do not fully align with the interests of American consumers, Coinbase remains open to engaging with lawmakers to find a workable path forward, according to his CNBC interview.

He argued that banks must not use legislation to limit competition or “put their thumb on the scale,” warning that this approach would exclude Americans from emerging financial opportunities.

To illustrate his point, Armstrong highlighted how stablecoin rewards could offer users yields of up to 3.8%, compared to an average of 0.14% (or 14 basis points) from traditional banks on dollar deposits. He also noted that stablecoins are typically backed by reserves such as U.S. Treasury bills, while banks operate on a fractional reserve basis.

Despite the disagreements, negotiations remain active. Senate Banking Committee Chair Tim Scott confirmed that discussions are ongoing, stating that “everyone is at the table working in good faith.”

Pushback and hurdles

Opposition to the bill has been building for months, as various stakeholders seek to protect their interests.

In December 2025, AMBCrypto reported that the American Federation of Teachers (AFT) urged the Senate to reconsider the legislation, warning that it could place “profound risk” on workers’ pensions due to the volatility associated with crypto assets.

Concerns over fraud have also intensified. Crypto-related scams have surged, with an estimated $14 billion lost to fraud in 2025 alone, according to blockchain analytics firm Chainalysis.

Market sentiment has reflected these concerns. The broader crypto market has experienced volatility over the past day, with the total market capitalization standing at approximately $3.23 trillion.

Final Thoughts

• Bitwise CEO calls for greater clarity around how the bill addresses DeFi and asset tokenization.
• Industry players push back on the legislation, although negotiations remain ongoing as all parties stay engaged in discussions.