Three prominent Democratic women could play pivotal roles in shaping future legislation regarding cryptocurrencies if Congress revisits the topic.

Democratic Leaders with Skepticism Towards Digital Assets

As the possibility grows for a shift in congressional power, key figures such as Representative Maxine Waters and Representative Shontel Brown are expected to influence the future of crypto regulation. Both have historically expressed skepticism towards digital currencies.

  • If the crypto Clarity Act fails this year, the same four congressional committees that were involved in its drafting will remain crucial in the upcoming session, with a strong likelihood that at least two will be led by Democrats critical of cryptocurrencies.
  • The House of Representatives is poised to likely transition to Democratic control, positioning Waters to chair the House Financial Services Committee and Brown to lead the House Agriculture Committee, both of whom have histories opposing crypto legislation.
  • Should there be a shift in control of the Senate as well, the situation for the crypto industry could worsen significantly.

In the coming January, Waters is likely to take the lead on legislation that will set the rules for the crypto market.

The California representative could reclaim her position as chair of the House Financial Services Committee, with Brown as a candidate to head the House Agriculture Committee, which is also crucial for crypto-related legislation.

Should the crypto sector and its supporters have to abandon the Digital Asset Market Clarity Act, similar to its predecessor, the Financial Innovation and Technology for the 21st Century Act (FIT21), the incoming Democratic committee leaders are expected to prioritize crypto regulation much lower than the current Republican leadership does.

"Regardless of personal opinions on crypto, it cannot be ignored," stated Summer Mersinger, CEO of Blockchain Association, in an interview with CoinDesk. "It exists, and we must establish a federal regulatory framework for it. It’s difficult to argue against that, irrespective of one’s stance on crypto."

Predictions from Kalshi indicate an 84% likelihood of a Democratic majority in the House, although the Senate is less certain, with only a 47% chance. If Democrats succeed, Senator Elizabeth Warren, known for her critical stance on crypto, could lead the Senate Banking Committee.

President Donald Trump has aimed to integrate crypto into U.S. financial regulations, achieving some success with stablecoins while contending with issues surrounding market structure. However, many Democrats are focused on severing Trump’s ties to the crypto industry, likely pursuing investigations into his digital asset dealings if they take charge.

Waters has expressed skepticism regarding Trump's motives but previously worked to advance stablecoin legislation, coming close to a deal in 2022 prior to last year's successful Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS) Act. While she has shown some willingness to engage with crypto legislation, she has been vocally critical of the Clarity Act, which faces diminishing chances for Senate approval.

Waters labeled it the "Calamity Act," arguing it would create substantial loopholes in federal financial regulations, endangering consumers and investors while constraining regulatory oversight. She also walked out of a hearing regarding the Clarity Act.

Additionally, she has opposed the inclusion of crypto in retirement accounts and has previously introduced legislation targeting Trump’s crypto business.

If Waters were to focus on limiting Trump’s crypto activities as chairwoman, even a legislative win might not address the president's potential conflicts of interest, as he would still hold veto power. Her office did not respond to inquiries regarding her plans.

Both the House and Senate have two committees that are primarily responsible for crypto policy due to the U.S.'s unique regulatory structure, dividing authority between agencies focusing on securities (the Securities and Exchange Commission) and derivatives (the Commodity Futures Trading Commission). The agriculture committees oversee the CFTC, while the SEC falls under the jurisdiction of the Senate Banking Committee and the House Financial Services Committee.

Brown is a strong candidate to lead the House Agriculture Committee should Democrats gain control, which could complicate matters for the crypto industry. The Ohio Democrat has previously opposed all digital asset legislation, including the Clarity Act, earning an "F" rating from the crypto advocacy group Stand With Crypto. Nevertheless, she has stated she could support crypto policies that protect consumers and promote innovation.

"I voted against the GENIUS and Clarity acts due to their failure to adequately address abuses and the potential for corruption," she remarked last year. "With the current occupant of the Oval Office benefiting from crypto and memecoin ventures, these bills do nothing to close conflict-of-interest loopholes."

However, if Waters and Brown take charge of crypto legislation in the House, the presidency will remain the same. Even with a larger Democratic majority, the upcoming session could devolve into a series of unproductive, symbolic bills. Winning control of the Senate would not guarantee that Democrats could successfully pass legislation into law.

In the Senate, Warren has been a vocal critic of the crypto industry, consistently highlighting what she perceives as corruption ties to the president. Despite her opposition, she has witnessed her fellow Democrats negotiate on crypto matters, often contrary to her position.

As the potential chair of the committee, her influence could increase, allowing her to dictate the progress of bills from her colleagues. She could follow the precedent set by former Senator Sherrod Brown, who led the banking panel without advancing any crypto-related legislation for years. (Brown, who lost his seat to Republican crypto advocate Senator Bernie Moreno, is also campaigning for another Senate seat in Ohio.)

Senator Amy Klobuchar has led the Senate Agriculture Committee but may soon transition to the Minnesota governor's office. This shift would position Senator Michael Bennet of Colorado, who recently lost his own gubernatorial bid, to take over. Bennet has consistently voted against crypto initiatives and proposed a bill in May that would impose stricter bans on crypto for government officials, including the president, compared to the compromise approach in the Clarity Act.

The four leading Democrats in relevant committees — Waters, Brown, Warren, and Bennet — all share an "F" rating from Stand With Crypto. Therefore, if the Clarity Act fails to progress in the Senate this September, the crypto industry may encounter significant challenges in future attempts.

Despite this, Cody Carbone, CEO of the Digital Chamber, which has been advocating for the legislation, maintains that crypto should be viewed as a "non-partisan" issue. "We will always aim to collaborate with every lawmaker on sensible solutions for this industry," he stated to CoinDesk in a statement. "We have engaged with many of the likely committee chairs, regardless of which party holds control in Congress."