Senate Agriculture Committee Chairman John Boozman (R-Ark.) said he “feels very strongly” about reaching a deal in the Senate on a virtual currency market structure bill (possibly by the end of the year), even after Democrats withdrew support for the bill the committee proposed last week.
“Everyone is working really hard right now and I think it shows that we can build some momentum by getting it through committee, so that’s a good thing,” Boozman said in an interview with CNBC on Tuesday.
Mr. Boozman’s committee has worked to create a national regulatory structure for the burgeoning industry under the Commodity Futures Trading Commission. The next step will be for the Senate Banking Committee to approve the Cryptocurrency Market Structure Act. The committee’s hearing on the document was postponed at the last minute from January 15 following opposition from the crypto industry.
The Republican senator worked on a draft bill with Sen. Cory Booker (D.N.J.) last year. Booker said during a Jan. 29 hearing that the bill differs from the bipartisan version the committee developed in November, and departed from the version voted on by the Senate Agriculture Committee. Booker’s office said the senator was not available for an interview.
During the hearing, Booker said Democrats’ concerns about the bill include the fact that President Donald Trump has “dabbed into cryptocurrencies himself,” which he called “ridiculous.”
The White House did not respond to requests for comment on Democrats’ concerns. A White House press secretary told CNBC in a previous statement that there was “no conflict of interest.”
During the hearing, Democrats proposed amendments that would prohibit public officials, including the president, from engaging in the cryptocurrency industry, prevent fraud related to virtual currency ATMs, and address involvement in digital products by foreign adversaries. None were approved.
The Agriculture Committee passed an advanced version of the bill on party lines on January 29th. The bill builds on the CLARITY Act, a bipartisan cryptocurrency market structure bill passed by the House of Representatives last summer.
Boozman said negotiations resumed immediately after the committee hearing.
“We’re making gains and we’re literally not missing a beat in terms of working with our Democratic colleagues to find solutions to these problems,” he said.
Boozman spoke to CNBC in the same week that President Donald Trump’s crypto advisor Patrick Witt led a meeting with banking industry and crypto executives on how to resolve issues in the creation of a crypto market structure bill.
Two crypto industry insiders familiar with the meeting told CNBC that the main focus of the discussion was whether digital asset companies should be allowed to offer stablecoin rewards to users, which banks objected to as being too similar to interest payments, which was prohibited under previous law. They went away feeling that some banks were not willing to compromise on this issue. The people spoke on condition of anonymity to discuss Monday’s closed-door meeting.
One of the main reasons Coinbase CEO Brian Armstrong said he could not support the Senate Banking Committee document was because of the “drafted amendments that would kill stablecoin rewards and allow banks to prohibit competition.”
The White House gave attendees a deadline by the end of the month to reach a compromise on stablecoin yields, a person familiar with the matter told CNBC.
After Monday’s meeting, bank participants said in a joint statement that their goal is to ensure that the law protects the security of the financial system, adding that banks of all sizes will continue to support policy development on digital assets.
Blockchain Association CEO Summer Marsinger said in a statement after the meeting that this is “an important step forward in finding a solution to make the bipartisan Digital Asset Market Structure Act a reality.”
Boozman called the issue of stablecoin rewards a “significant controversy” and said he believes concerns from both the crypto and banking industries in this regard are “legitimate.”
“I think we can find a compromise on both sides,” Boozman said. “It may not be what either side wants, but the important thing is to find something that is acceptable to both parties, and that is what we are working hard on.”
CNBC’s Emily Wilkins contributed to this report.
