- Senate’s new bill promises groundbreaking developer protections for crypto projects.
- Dual regulatory structure could resolve long-standing cryptocurrency industry jurisdiction issues.
- Crypto industry celebrates bill’s clear rules on decentralized governance tokens.
The Senate Banking Committee’s newly released draft, the “Responsible Financial Innovation Act of 2025,” has drawn strong support from leaders in the cryptocurrency industry. The 182-page bill, which was released on Friday, has provisions that developers are celebrating as a massive victory. Industry experts are billing the protections of the bill’s developers as the most extensive in federal legislation that has ever been witnessed.
Executive Director and CLO of DeFi Education Fund Amanda Tuminelli applauded the bill, saying its developer protections were the best language in any of the earlier legislative proposals. Legal expert Gabriel Shapiro further underscored that the bill better addresses decentralized governance systems, especially the regulation of blockchain-based governance tokens (BORGs). He underlined that the act deals with long-held reservations regarding the possibility of these tokens being considered securities in the United States.
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How the Bill Addresses Industry Concerns
The draft bill aims to clarify many of the regulatory challenges facing the cryptocurrency industry. A significant provision concerns decentralized autonomous organizations (DAOs) and the related governance tokens. The division of securities and non-securities under the legislation aims to cushion payment and utility tokens against a wider scope of restrictions, a hugely welcome New Clarity for DeFi projects.
Additional clauses are designed to exclude non-fraudulent tokens that exist now and may be subject to enforcement by the SEC in the future. There are also protections of staking mechanisms, airdrops, and tokenization processes in the bill. Physical infrastructure network and DeFi protocol exemptions are meant to support innovation in these areas.
A Dual Regulatory Structure to Resolve Ambiguities
The bill introduces a dual regulatory framework that splits oversight between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). This framework aims to eliminate confusion related to jurisdiction, which has undermined control of digital assets. The proposed system will have the CFTC regulating digital commodities and the SEC regulating investment contracts involved with such commodities in primary market transactions.
When the draft passes through the Senate Banking Committee, industry leaders, like Colin McLaren, are urging Senate Democrats to focus on innovation. He claims that the bill must be aimed at promoting startups and new businesses rather than establishing restrictive rules.
As markup proceedings are likely in the near future, the future of this innovative legislation is in the furor of negotiations and the reaction of the Democrats to its contents. The bill has sparked a wave of optimism across the cryptocurrency sector, but its final passage remains uncertain. The coming weeks will determine whether it can strike the right balance between regulatory oversight and fostering innovation.
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