TLDR:

• Stablecoin yield rules now dominate crypto market structure negotiations in the U.S. Senate.
• Coinbase withdrew support after amendments restricted stablecoin reward programs earlier this year.
• Senator Thom Tillis now holds a key vote as Senate Republicans attempt to advance the bill.
• DeFi provisions remain unresolved while lawmakers focus on stablecoin reward language.

The push to advance a U.S. crypto market structure bill faces delays as lawmakers debate stablecoin yield rules. 

Discussions intensified this week after fresh legislative language circulated among key Senate offices. Negotiations now center on how crypto firms handle rewards linked to stablecoins. 

The outcome could determine whether the Senate Banking Committee resumes work on the bill later this month.

Crypto Market Structure Talks Focus on Stablecoin Yield

The stablecoin yield debate now sits at the center of crypto market structure negotiations in Washington.

According to reporting shared by journalist Eleanor Terrett on X, lawmakers continue discussions after weeks of industry lobbying. The White House recently circulated draft legislative text to Senator Thom Tillis’ office.

The document followed negotiations between banking groups and crypto firms during the past month. Those talks attempted to narrow disagreements over rewards tied to stablecoin products.

Senator Tillis previously raised concerns about stablecoin yield provisions earlier this year. In January, amendments linked to him and Senator Angela Alsobrooks restricted the scope of such rewards.

Those changes later prompted Coinbase to withdraw support for the bill. The company cited the amendments among several concerns about the proposal.

Recent meetings between Tillis’ staff, industry representatives, and White House officials now seek a workable compromise. Discussions reportedly continue as both sides adjust the language.

Digital Chamber CEO Cody Carbone said conversations with Tillis have remained constructive. Industry groups expect negotiations to focus on rules both banks and crypto firms can accept.

DeFi Issues and Committee Timeline Still Unresolved

While yield dominates debate, other crypto market structure provisions remain unresolved.

Industry participants told Terrett the stablecoin issue now consumes most attention in negotiations. As a result, discussions around decentralized finance rules have slowed.

Some DeFi stakeholders say Senate Democrats recently renewed focus on those outstanding sections. They want clarity on how decentralized protocols fall under the proposed regulatory framework.

Ethics concerns also remain part of the debate inside the Senate Banking Committee. Several Democratic lawmakers continue to review potential conflicts related to digital asset policy.

Despite these hurdles, lawmakers still aim to restart the legislative process soon. Committee leaders hope to reschedule a markup once stablecoin reward language stabilizes.

The bill could still advance along party lines if Republican support holds. However, Senator Tillis’ position remains central if Democrats decline to back the measure.

Industry groups continue pushing for a vote before delays push negotiations deeper into the year. Some participants now watch the next three weeks for movement on stablecoin yield language.

Trade groups told Terrett they remain cautiously optimistic about progress before late March. A revised draft could return to the Senate Banking Committee if talks advance

The crypto market pulled back on Friday following a strong rebound on Thursday.

After rallying nearly 5.5% over the past day, the global crypto market capitalization once again retracted, dropping 2% to $2.48 trillion on Friday, March 6. Bitcoin (BTC) was down 1.8% in the daily timeframe, while Ethereum (ETH) posted losses of 1.3%. Other major cryptocurrencies, such as BNB (BNB), XRP (XRP), and Solana (SOL), also faced similar losses as the broader market cooled.

As crypto prices fell, it triggered the liquidation of traders with highly leveraged bullish positions across leveraged markets. Data from CoinGlass shows that nearly $167.5 million of the total $252 million liquidations that took place in the past 24 hours came from long positions.

Amidst the market drop, the crypto fear and greed index fell by 4 points to 18, a sign that risk-on sentiment among investors seems to be evaporating.

The crypto market fell after Bitcoin faced rejection at $74,000 on Thursday after rallying over 16% in the past 5 days. This came as investors booked profits, which is quite common after an asset has rallied over multiple days.

Bitcoin’s rejection and successive drop caught highly leveraged traders off guard, triggering a cascade in liquidations which then rippled off to other altcoins in the leveraged markets.

Multiple analysts note that the rejection has left BTC vulnerable to more downside and has dampened the short term outlook for the entire sector.

$2.68 billion options expiry today

Another key reason why the market slipped lower today is fears surrounding a $2.68 billion options expiry across the crypto market on the Deribit exchange at 8:00 a.m. UTC.

Notably, around 32,000 Bitcoin contracts with a notional value of $2.2 billion are set to expire with the max pain price at $69,000. Concurrently, Ethereum options worth $397 million will also settle today.

Such a massive options expiry event typically leads to significant price volatility as traders adjust or close out their positions. The open interest of the total crypto market has dropped 4.76% over the past 24 hours, suggesting traders seem to be unwinding their bets ahead of the potential price swings.

Rising energy prices spark rotation to traditional safe-haven assets

The crypto market also tanked amid rising energy prices after Iran’s suspected attack on U.S. oil ships around the port of the Strait of Hormuz disrupted global supply chains.

Investors fear that rising crude oil and gas prices due to the conflict could reignite inflation. Consequently, they have turned risk-averse as they rotate capital towards traditional safe-haven assets such as gold, which has performed significantly better during these uncertain times.

Stalled crypto legislation

Investor sentiment was also hurt after progress on the CLARITY Act, a highly anticipated U.S. market structure bill, stalled once again.

While U.S. President Donald Trump has called for a swift implementation of the framework, the landmark bill hit a new impasse after leading banking groups rejected a White House compromise for the bill, citing risks to traditional institutions. 

The delay has cast severe doubt on whether the CLARITY Act can pass before the 2026 summer recess, removing a major regulatory tailwind for the industry.

TLDR:

• The Fed, OCC, and FDIC confirmed tokenized securities get identical capital treatment to traditional assets at U.S. banks.
• Banks can now use tokenized stocks and bonds as loan collateral under the same rules as conventional securities.
• The guidance covers both public blockchains like Ethereum and private permissioned networks without distinction.
• Derivatives tied to tokenized assets also receive standard regulatory treatment, expanding the scope significantly.

U.S. banking regulators have issued landmark joint guidance clearing banks to hold tokenized securities under the same rules as conventional financial assets. 

The Federal Reserve, Office of the Comptroller of the Currency, and Federal Deposit Insurance Corporation released the coordinated announcement together. 

It confirms that a tokenized stock, bond, or other asset carries identical capital treatment to its off-chain equivalent. The move removes a regulatory barrier that major financial institutions had cited for years as a reason to stay off blockchain rails.

Banks Can Now Use Tokenized Assets as Standard Collateral

The guidance covers three core operational changes for U.S. banks. 

First, tokenized securities are now eligible collateral for loans, treated identically to traditional stocks or bonds. Second, the rules apply regardless of whether the token sits on a public blockchain like Ethereum or a private permissioned network. 

Third, financial derivatives linked to tokenized assets receive the same treatment as conventional derivatives.

That last point carries significant weight. Derivatives markets dwarf spot markets in volume. Extending identical regulatory treatment to tokenized derivatives opens a much larger surface area for blockchain adoption.

The announcement does not require new legislation. It is guidance, meaning banks can act on it immediately. No waiting period applies.

For institutions like JPMorgan, Goldman Sachs, and Bank of America, the obstacle was never technological. 

According to posts on X, including commentary from @BullTheoryio and @markchadwickx, major banks were awaiting exactly this kind of regulatory clarity before moving capital onto blockchain infrastructure.

Tokenization Market Stands to Absorb Trillions in Traditional Capital

The addressable pool of assets is enormous. Global equity markets alone exceed $100 trillion. Bond markets add tens of trillions more.

Real estate sits on top of that. Most of that capital has remained off-chain, not due to technical limitations, but due to unresolved regulatory questions around how tokenized versions would be treated on bank balance sheets.

That question now has a clear answer. A tokenized Apple share carries the same legal claim, the same ownership rights, and the same balance sheet weight as a traditional share. Regulators have confirmed this directly.

The practical effect is that banks can begin integrating tokenized securities into existing workflows without restructuring their risk or compliance frameworks. This lowers the operational cost of adoption substantially.

Public blockchains are specifically included in the guidance. That detail matters. Many institutions assumed regulators would favor private, permissioned networks. 

The explicit inclusion of public chains broadens the infrastructure eligible to handle institutional-grade asset flows

Bitcoin is likely to outperform gold on price performance through to 2029 after gold’s strong recent rally, says macroeconomist Lyn Alden.

“If I had to bet Bitcoin versus gold over the next two to three years, I would bet Bitcoin,” Alden said on the New Era Finance podcast on Wednesday.

“Gun to my head, if I had to say which one I think outperforms, I would say Bitcoin,” she added.

“It’s usually a pendulum between the two. If gold has gone up as much as it did, the entire diminishing return story per cycle is going to be erased in the coming one, too.”

Many crypto industry executives, including Coinbase CEO Brian Armstrong, have predicted that Bitcoin (BTC) will reach $1 million by 2030 with clearer regulations taking shape in the US, which Armstrong called a “bellwether for the rest of the G20.” 

Alden dismisses that gold is in a bubble

Bitcoin is often compared to gold as a hedge against inflation and economic uncertainty, with many investors dubbing it “digital gold.” 

Alden said gold is seeing “somewhat euphoric” sentiment after it reached a new all-time high of around $5,608 in January.

“I wouldn’t say it’s a bubble, but it’s somewhat euphoric,” she said.

The JM Bullion gold Fear and Greed Index, which tracks sentiment toward gold, posted a “Greed” score of 72 out of 100 on Friday. On the same day, the Crypto Fear and Greed Index, which measures sentiment across Bitcoin and the broader crypto market, posted an “Extreme Fear” score of 18 out of 100.

Alden said that the sentiment toward Bitcoin is “somewhat unfairly negative.” Bitcoin is trading at $71,164, down 44% from its October all-time high of $126,000, according to CoinMarketCap.

Alden said she avoids relying too heavily on rigid narratives about the relationship between the two assets.

“I try to be hesitant about reading into how absolute these things are. Gold and Bitcoin can go up together, they can go down together,” she explained.

Investors debate Bitcoin’s narrative

While the two assets are often grouped together as alternatives to fiat currencies, the relationship isn’t always consistent; sometimes the prices move in tandem during periods of macro uncertainty, and other times they decouple.