AISenate Banking markup of the crypto market structure CLARITY Act

Name: Senate Banking markup of the crypto market structure CLARITY Act
Start: 2026-05-14
Location: US Senate

Digital Assets and Bank RegulationSenate Banking, Housing, and Urban Affairs · 2026-05-14 · 119th Congress

The Senate Banking, Housing, and Urban Affairs Committee held an open business meeting to mark up H.R. Begins at ▶ 0:16:35

Transcript

Highlights

▶ 0:16:35Chair Warren: Good morning. I hope you all are doing well. It is good to be here this morning. I called the committee to order. Any members who wish to speak on the bill can do so after votes. Amendments will be called up in order of seniority. Senators are permitted to speak on the amendment prior to voting for up to but not to exceed two minutes.

▶ 0:17:05Chair Warren: We will begin with opening statements today. It is an important day not just for this committee but for the country. For years the digital frontier was trapped in a regulatory gray zone. Developers, entrepreneurs and investors were left with uncertainty. They face confusion and enforcement actions when instead the government should have been crafting clear rules of the road.

▶ 0:17:34Chair Warren: Those hurdles drove innovation overseas, left americans exposed and made it harder for law enforcement to do their job. Today we change that. The bill achieves three simple goals. Number one, protecting consumers. Keeping innovation here at home. And safeguarding U.S. national security. Those are not partisan goals. They are american priorities.

▶ 0:18:06Chair Warren: Protecting consumers means making sure everyday people come first. It needs clear disclosures, safeguards against fraud and rules that keep markets open, fair and efficient. It means that if someone in south carolina invests in digital assets, they are protected by a framework with enforceable legal standards. This bill gives americans confidence that the system works for them, not against them.

▶ 0:18:41Chair Warren: Keeping innovation at home means giving american builders, entrepreneurs and businesses the clarity and certainty to do what they do best. Until today outdated rules, unpredictable enforcement and outright hostility have forced far too many american companies overseas. That cost us jobs, investment and leadership.

▶ 0:19:11Chair Warren: This bill says that the future of finance should be built in america, under american laws and with american values. Safeguarding our national security means closing the doors that criminals, terrorists and hostile regimes have tried to exploit. This bill strengthens anti-money laundering and sanctions rules and gives law enforcement better tools to go after bad actors.

▶ 0:19:42Chair Warren: These tools make it harder to hide and easier to enforce the law. None of this happened overnight. It happened because members on both sides of the aisle chose to sit down, listen and work. We have had months of good faith negotiations.

▶ 0:20:05Chair Warren: Republicans did not get everything we wanted but we made real progress with our democrat colleagues and this bill and the american people will be better off because of it. This legislation does not take sides between traditional finance and new technology or republicans and democrats. It takes the side of everyday americans.

▶ 0:20:33Chair Warren: It brings digital assets out of the shadows and into a system that is safer and more transparent. This is what good governance looks like. Today we take a step forward together to protect investors, grow the economy and keep america leading the world. I am proud of this committee for doing the work and I look forward to moving this bill forward.

▶ 0:21:04Chair Warren: I now recognize ranking member warren for opening comments.

▶ 0:21:06Sen. Warren: Thank you. American families across this country are struggling. The cost of groceries, utilities, healthcare is up. We could be working right now on changes that would help bring down prices and help our economy. We could be working on capping credit card interest rates. Every day that we failed to deliver, families are charged an extra $368 million in interest.

▶ 0:21:38Sen. Warren: We could prevent big banks from saddling customers with overdraft fees. Every year that we failed to deliver, families could be paying up to $5 billion per year that they otherwise would be able to keep. We could be stopping rampant fraud and theft on payment platforms.

▶ 0:22:03Sen. Warren: Our failure to deliver here means americans are paying our failure to deliver means that americans are paying hundreds of billions of dollars after getting tricked and trapped. Instead of that we are spending our time working on a bill written by the crypto industry for the crypto industry. Nothing made it into this bill that was not approved by the crypto industry. Why are we working on this?

▶ 0:22:29Sen. Warren: According to a survey by crypto news outlet coin desk, crypto is at the bottom of U.S. voters priority heading into elections. Just 1% of respondents ranked crypto as their top concern. Our job is to serve the american people.

▶ 0:22:49Sen. Warren: Our job is not to advance a pro industry crypto bill that would put american consumers, american investors and our national security and our financial system at risk. Our job is not to advance a pro industry crypto bill that would increase -- grease the skids of the president's crypto grift.

▶ 0:23:23Sen. Warren: Many members of this committee have underscored the importance of getting this bill right and despite multiple calls for a public hearing on this bill, calls from senator reed, senator kennedy, senator van hollen, senator smith. We have never had a single hearing on this bill. Today Mr. chairman you are shutting down members of this committee who have amendments to strengthen this bill.

▶ 0:23:50Sen. Warren: You ruled out more than one dozen amendments because of procedural requirements. Take a look at what got ruled out. This includes a fixed request by the national sheriffs association to close a massive loophole in the current bill that would make it harder for law enforcement officials to go after cartels and criminals using decentralized platforms to launder money.

▶ 0:24:19Sen. Warren: The surest concerns have just been cut out. This includes a fix from community banks to stop a significant flight of deposits out of the banking system that would hurt small businesses and communities across the country. An amendment to help community banks, we will not even get a hearing today, much less a vote. Mr.

▶ 0:24:43Sen. Warren: Chairman, you could reverse your ruling now and I would welcome a full debate on every single democratic and republican amendment that has been filed to fix the very real flaws in this bill. This bill is just not ready for prime time. First, the draft in front of us would blow a hole in our security laws that have protected investors since 1929.

▶ 0:25:15Sen. Warren: Most americans do not want their pension at risk so that a few crypto billionaires can juice their profits. Second, this bill declares open season on defrauding american consumers who use crypto. The bill wipes out a huge number of state-level protections against fraud. Third, the bill puts our financial system at risk by repeating the mistakes of 2008.

▶ 0:25:44Sen. Warren: Letting the banks load up on risky debts, letting them scrape off the profits and then come back to the american taxpayer for a bailout. Fourth, the bill puts our national security at greater risk. 3 days ago the treasury department issued an alert warning that iran is exploiting crypto businesses to move their money around.

▶ 0:26:13Sen. Warren: Multiple public analyses document that drug cartels are shifting their money laundering to crypto and "the cops cannot keep up." and finally the bill does not lift even the tiniest finger to address the trump administration's crypto related corruption.

▶ 0:26:38Sen. Warren: Since taking office last year president trump and his family have amassed a staggering $1.4 billion in gains from crypto deals alone. No president and no one in congress should be allowed to profit from crypto at the same time that they are enforcing rules to regulate it. This kind of corruption undermines our democracy and it undermines the legitimacy of the crypto industry.

▶ 0:27:09Sen. Warren: It will keep on growing if congress fails to rain it in. Some of you may remember republicans sat in this very room a year ago and made one promise after another as they passed the genius act. They promised we will close the national security loopholes. They promised, we will address glaring ethics problems. They promised we will fix the yield issue.

▶ 0:27:40Sen. Warren: Republicans told us not to worry about the gaps in the first crypto bill because the second bill, the bill that we have today, would fix every one of those problems. Today we are voting on the second bill and every one of those problems still exist today. And this time the same republicans are shutting down amendments that would make the fixes they promised a year ago.

▶ 0:28:12Sen. Warren: This markup is our chance to fix these problems and until we fix these problems, none of us, republican or democrat, should advance this bill out of committee or onto the senate floor. Thank you, Mr. chairman.

▶ 0:28:26Chair Scott: I want to make a couple of comments about the process we have undertaken over the last several months. Particularly as it relates to some of the amendments that were taken out because they were not in order. After the amendment process had a walk-through, ranking member warren's staff objected to a republican amendment arguing that it should be thrown out because it referenced the wrong substitute amendment number.

▶ 0:28:54Chair Scott: When they insisted on that standard, committee staff reviewed the full roster to ensure consistency. Staff confirmed with the committee clerk consultation, with a parliamentarian and for staff that there were amendments filed incorrectly. What I decided to do was as opposed to throwing all of those out, throw out only the ones that were most egregious.

▶ 0:29:20Chair Scott: The process we have gone through was to make sure that both sides had an opportunity that this whole discrepancy started when staffers decided to target a republican amendment. As my colleagues on the right recognized, I throughout amendments on our side as well.

▶ 0:29:46Sen. Warren: My drive reply -- might I reply? I appreciate the work we do together. I want to correct the record on an important issue. It is your call alone to rule these amendments out of order. When we talked last night, I made clear I'm happy to have all of the democratic and republican amendments in. You and you alone have decided which are in and which are out.

▶ 0:30:17Sen. Warren: That creates a problem because they are very important amendments that address very important issues that I think we should hear from so I will reiterate my lack of objection. Let them all hurt, let us vote on all of them.

▶ 0:30:32Chair Scott: That does not change the fact on how we got to where we are. It was brought by my staff and your staff. Let me say this quickly because I am not going to go back-and-forth on this issue. Democrats have frankly worked hard on this bill. Our bill first came out in june of last year.

▶ 0:30:54Chair Scott: Since june of last year we have added 33,000 words, 219 pages in an effort to make this legislation as bipartisan as humanly possible. I cannot imagine how much time senator alsobrooks has spent on this legislation.

▶ 0:31:18Chair Scott: Frankly, during very difficult and challenging times our focus remained on getting things done and others have worked with her to get to where we are. Gallego has spent a ton of time trying to find a path forward.

▶ 0:31:43Chair Scott: As frustrating as this process has been without question, when I talk to members on your side of the aisle including senator warnock, senator cortez masto and senator warner, the one thing I can tell you, the entire process we have disagreed vehemently but respectfully and consistently and working toward the end result that makes america better.

▶ 0:32:15Chair Scott: As a kid who grew up in poverty the thing that attracts me to this issue the most is democratization, an opportunity to lower prices and create access points that do not exist. This should not be about republicans and democrats. It should not be about who was on which side of the aisle or whether you agree with what we have done. There should be about the american people and nothing else. I want single mothers like the one who raised me to have more opportunities and more access at a lower price.

▶ 0:32:44Chair Scott: We will disagree on this today but I hope that what we end up with is a legislative product that is good now and gets another bite at the apple as it heads to the floor. This is not over and I hope that no one thinks this is over, this process has been transparent. It has been hard and it has been clear. And that is good news for the american people watching this process.

▶ 0:33:12Chair Scott: I have tried my very best to take the expertise of an ag who understands issues better than others. I have worked really hard with folks who was a county supervisor as I was to understand the local impact and community banks, we have done a very good job putting it together. I am very long-winded because I wanted to be a preacher like senator warnock. [laughter] but it did not work out for me. God did not call me to that.

▶ 0:33:44Sen. Warnock: Mr. chair, stay in your lane.

▶ 0:33:48Chair Scott: Someone should cut him off before he calls for an offering. [laughter] here's the point. This is a real opportunity to move the ball forward for a lot of people and a lot of places losing confidence in american institutions. Let's not demonize because it is easy.

▶ 0:34:18Chair Scott: Let's work together because it is hard and important. Senator lummis. >> Mr. chair man, I have a point of order. I agree, we need to continue to move forward. My question is so we do not run afoul of this in the future is the amendment cortez masto 16 was ruled out of order. Can you explain why it was out of order?

▶ 0:34:42Chair Scott: Certainly. . We asked all amendments to be written to the ans and the amendments were written to the friday clarity act, friday when we release the legislation, we asked the amendments to be written to the substitute language. >> and it was.

▶ 0:35:08Chair Scott: It was not. >> how was it not? That would be helpful just so I know. >> it is a strike and replace of text in the hr.

▶ 0:35:37Chair Scott: It would not be accepted on the floor.

▶ 0:35:41Sen. Cortez Masto: I asked a parliamentarian if this was out of order and she said no. I do think it would be helpful in the future so that we do not get caught up in this craziness and we can still move forward as a body that works together on amendments, has the conversation and discussion that we have an understanding of these amendments. I appreciate you taking my point of order.

▶ 0:36:09Sen. Cortez Masto: For the record, I will submit the parliamentarian's response to the question that I had.

▶ 0:36:14Chair Scott: Without objection. We will submit our conversation as well. Senator lummis.

▶ 0:36:22Sen. Lummis: Thank you, Mr. chairman. I want to start by a casual conversation among friends around the dais. Mr. warner, thank you so much for working so hard on this bill over the last nine months. Senator cortez masto, thank you. You brought a level of expertise on illicit finance that none of the rest of us had and I want to thank you for that. Your thoughts Mr.

▶ 0:36:50Sen. Lummis: Warnock throughout the last nine months have been additive to what I think is a very good bill. Mr. gallego has worked tirelessly behind the scenes on multiple issues that are involved in this legislation. I want to single out senator alsobrooks for her tremendous time commitment and work with Mr.

▶ 0:37:14Sen. Lummis: Tillis on the language that has helped bring this bill to the floor today on the concerns that the banking industry had about the genius act. This has been a bipartisan dialogue that has gone on for nine months. It has been almost tireless. Mr. moreno, Mr. tillis, Mr.

▶ 0:37:47Sen. Lummis: Kennedy. [laughter] and especially senator scott who has kept us on track for nine months. This is the hardest piece of legislation I have ever worked on. 14 years in the wyoming legislature, eight years as state treasurer and 14 years in congress. This is the hardest piece of legislation I have ever worked on.

▶ 0:38:15Sen. Lummis: Your colleague kirsten gillibrand said the same thing and she has more experience than I do in the U.S. senate. And it is because this is a case of first impression. This is a very new commodity and security. And it takes time to craft something to address the innovation that has been brought about through block chain technology.

▶ 0:38:47Sen. Lummis: That is why it has taken such a bipartisan effort, heavy lift, lots of negotiations, involvement from those in the industry, and it has morphed since we began five years ago because the industry has matured over those years.

▶ 0:39:07Sen. Lummis: This is new and to have something this innovative come to us via legislation today really is quite remarkable. I want to thank the people in this room, both in the audience and at the table, for their dedication. Treasury, the white house, the industry.

▶ 0:39:35Sen. Lummis: We have all worked hard together and I pledge to you, we will continue to work hard together after today and before this bill hits the floor to address that 1% of the remaining issues that did not come to fruition before today, in spite of our round-the-clock negotiations.

▶ 0:40:07Sen. Lummis: This is america's innovation of the 250th anniversary of our constitution. There has been nothing like it in our history. This bill continues the legacy of america by ensuring innovation happens here on U.S. soil under clear pro-growth proconsumer guidelines.

▶ 0:40:36Sen. Lummis: When I was listening to the ranking member, the risks of which she spoke exist right now because there is no regulatory framework. There is no way now that this industry can protect the good actors, discover and punish the

▶ 0:41:12Sen. Lummis: Bad actors and create a playing field with clear regulation both at the sec and cftc that everyone can play under and continue to innovate. We can return this industry to the united states because the majority of it has already left for overseas because this legislation was not ready until today.

▶ 0:41:37Sen. Lummis: Let me go through a couple of the things that we have done to strengthen and address some of the issues that have been raised. Regard to anti-money laundering and illicit finance. It creates a risk-based exam standards. It expands treasury's authority to act swiftly against foreign money laundering. It creates studies on mixers and tumblers. It requires annual treasury reports on foreign jurisdictions compliance with standards.

▶ 0:42:11Sen. Lummis: It requires recurring treasury reports on offshore stablecoins. It requires mandatory educational materials on digital asset risks, insider resale restrictions, to prevent punp a nd dump schemes. It has timely disclosure requirements, broker-dealer insolvency disclosure, a federal regulatory floor for crypto kiosks. This has been a problem in my state.

▶ 0:42:43Sen. Lummis: Tokenized securities remain securities under sec jurisdiction. Ftc authority over unfair practices. $30 million per year through 2030 14 10 seven -- throught 2031 for fincen.

▶ 0:43:10Sen. Lummis: With regard to fraud applies bsa regulation to digital asset brokers, dealers and exchanges. The list goes on and on. This is a pro-law enforcement bill. It is also a proconsumer bill. Consumers can now transmit money between them faster and cheaper than they can now.

▶ 0:43:36Sen. Lummis: It provides a level playing field regardless of whether you live in rwanda or queens, about transmitting money faster and cheaper. It provides a woman who is trying to get out of a miserable marriage the opportunity to walk away with her money and her head.

▶ 0:44:00Sen. Lummis: It provides people who are being tortured in foreign countries the opportunity to walk away from that country with their money and their head because bitcoin can be memorized. This is an innovation that provides individual freedom, individual savings.

▶ 0:44:21Sen. Lummis: It is faster, cheaper, it is secure and we are inviting that consumer environment into our country under a very clearly articulated set of rules. And it is because of all the work that has gone into this by the people in this room. I absolutely pledge that I will work with you before this bill gets to the floor.

▶ 0:44:51Sen. Lummis: We know those few remaining little items that we have to work on together. I trust you and I want you to trust me to see this process through because we know when we work together that we can create a product that we can be proud of and the american people can be proud of. Thank you, Mr. chairman.

▶ 0:45:13Chair Scott: Senator tillis.

▶ 0:45:15Sen. Tillis: Very quick, Mr. chairman. Senator lummis did a wonderful job. I just want to reinforce a couple of things. Honestly when I heard the ranking member talk, I thought I had teleported into a parallel universe where we were talking about a different bill being negotiated. This bill has all the attributes that senator lummis discussed.

▶ 0:45:38Sen. Tillis: That is why aarp has endorsed it and law enforcement supports it because the status quo is honestly unacceptable. Not to mention the competitive threat that we have from foreign jurisdictions just to take the money elsewhere and we are aiding and abetting and expanding the use of illicit finance through this tool. I don't need to get into those merits of the bill anymore. I just want to thank senator alsobrooks. I want to thank senator gallego.

▶ 0:46:08Sen. Tillis: I want to thank senator cortez masto who really opened my eyes to some of the prosecutorial issues that I had not paid attention to. Senator warner, senator warnock. I have done a lot of bipartisan bills at my time in the senate and the only way this works is a bipartisan vote out of this committee to get all of these things in this bill moving. The democrats control the motion to proceed.

▶ 0:46:37Sen. Tillis: Like senator lummis I am committed to work in good faith and I have proven that multiple times when it was tough for a republican to lead something and I am going to do it again here. Let's get the momentum out of this committee. Finally, I told senator alsobrooks, what a joy it has been to work with her staff. We have talked about the stakeholders, the folks from the white house.

▶ 0:47:05Sen. Tillis: But we should all give our staff who have gotten here before us and left here after us for all of the hard work they have done and we owe them the respect of reporting this out on a bipartisan basis today. Thank you, Mr. chair.

▶ 0:47:18Chair Scott: Senator reed. This will be the last comment. Help me remember that some members have to go to other committees. Floor is yours, senator reed.

▶ 0:47:32Sen. Reed: I am going to be very brief, Mr. chairman. I've heard both you and senator lummis speak eloquently about working together. I have been on this committee almost 30 years. The definition of working together on a markup is allowing amendments to be called up and voted upon. The vote determines where we go forward.

▶ 0:47:59Sen. Reed: I have never witnessed anything like this in these 30 years but it is arbitrarily eliminating amendments, telling people that can c they cannot bring them up or modify them to be brought up. I am willing to work together but this is not an example of working together.

▶ 0:48:21Chair Scott: I moved to call up the digital asset market clarity act of 2025 and I ask unanimous consent that we dispense with the reading of all amendments. Senators will find printed copies in front of them the text of which has already been made available. Is there an objection? Without objection, so ordered. I moved to consideration with the manager's amendment scott amendment number one.

▶ 0:48:49Chair Scott: I asked that scott amendment number one be adopted and considered for purposes of further amendment. I ask that the amendment be adopted by voice vote. All in favor say aye. All opposed. Amendment is agreed to. Senator rounds, you are recognized.

▶ 0:49:11Sen. Rounds: Thank you, Mr. chairman. My amendment I have with cosponsors senator kim and senator warner and I want to thank them for their participation. This would require financial regulatory agencies to establish a.I. Elevational labs or sandboxes. This will enable financial institutions to experiment with a.I.

▶ 0:49:35Sen. Rounds: Test projects without expectation of enforcement action, taking a balanced approach that encourages innovation and responsible adoption of a.I.. This amendment would create a venue, a sandbox for institutions to safety test and experiment with cutting edge technologies while allowing regulators to learn about the tools that will transform financial services. It closely aligns with the purpose of the bill we are considering today which is why I urge my colleagues to support this amendment.

▶ 0:50:07Sen. Rounds: Thank you, Mr. chairman and I will ask for a vote.

▶ 0:50:10Sen. Warren: Mr. chairman, I would like to be recognized.

▶ 0:50:14Chair Scott: 60 seconds.

▶ 0:50:16Sen. Warren: This amendment would establish a sandbox as senator rounds says for artificial intelligence products and services in the financial sector. I appreciate my colleagues interest in this issue. But boy, I am not ready to support this proposal. This is not the place to make decisions about a.I. Regulation. The committee should hold hearings on the implications of a.I..

▶ 0:50:45Sen. Warren: We should have a debate about the policy options. I am happy to work with my colleagues to see if there is a version of this amendment that we can support. But this provision is not there yet. I don't think a track record of these sandboxes over the past decade in financial technology or fintech context should give us confidence that it turns out to have good results for the american people and that it ensures safe innovation for

▶ 0:51:16Sen. Warren: A.I.. I think this is way too big for a little amendment like this and it opens doors we should not be opening without a much fuller discussion and hearings. I would urge my colleagues to vote no on rounds 133.

▶ 0:51:32Chair Scott: The clerk will call the role. Aye. >> Mr. crapo. Mr. rounds. Mr. tillis. >> aye. >> Mr. kennedy. Mr. hagerty. >> aye. >> Ms. lummis. Ms. britt. Mr. ricketts. Mr. banks. Mr. cramer.

▶ 0:52:05Chair Scott: Mr. moreno. Mr. mccormick. >> aye. >> Ms. warren. >> no. >> Mr. reed. Mr. van hollen. >> no by proxy. >> Ms. cortez masto. >> no. >> Ms. smith. >> no. >> Mr. warnock. >> no.

▶ 0:52:35Chair Scott: >> Mr. kim. >> aye. >> Mr. gallego. >> no. >> the vote is 15 in favor and nine opposed.

▶ 0:52:48Chair Scott: Amendment is agreed to. I now call up warren 74.

▶ 0:52:59Sen. Warren: Let's talk about some of the people who would be hurt by a bill that supercharges the crypto industry without guardrails. People saving for retirement and people with pension plans. It fails to address one of the biggest concerns that retirees face, the tokenization loophole. This country's biggest workers unions and groups representing the largest pension funds have said that this is a catastrophic problem.

▶ 0:53:26Sen. Warren: Under this bill companies could escape basic securities laws by raising money through tokens rather than traditional securities like stocks, exposing americans to a host of risks by removing necessary investor protections. The bill also kneecaps the federal and state law enforcement authorities ability to crack down on crypto fraud and scams.

▶ 0:53:53Sen. Warren: In other words,, in other words, this bill sets up investors to be defrauded with no recourse. My amendment would require investment advisors and other entities in the financial system to develop and implement processes to protect investors from the heightened risks posed by crypto before recommending it to americans looking to invest their hard-earned money. Everyone in this committee should agree with this simple fix to protect our investors.

▶ 0:54:24Sen. Warren: I urge my colleagues to support warren amendment 74.

▶ 0:54:29Chair Scott: If someone wants to be recognized for rebuttal. >> thank you. This amendment would single out digital assets for a special presumption of noncompliance and create unnecessary litigation risk. This amendment should not be adopted. It requires fiduciaries to implement special processes to protect clients from digital asset risks or be presumed to have violated their fiduciary duty.

▶ 0:54:59Chair Scott: Current fiduciary standards already require them that beauty airy to act in their -- already require intermediaries to act in their clients best interests making this amendment unnecessary.

▶ 0:55:09Chair Scott: The clerk will call the role. No. >> Mr. crapo. Mr. rounds. >> no. >> Mr. tillis. >> no. >> Mr. kennedy. >> no. >> Mr. hagerty. >> haggerty is no. >> Ms. lummis. >> no. >> Mr. ricketts. Mr. banks. Mr. cramer.

▶ 0:55:41Chair Scott: Mr. moreno. Mr. mccormick. Ms. warren. Mr. reed. Mr. warner. Mr. van hollen. >> aye by proxy. >> Ms. cortez masto. Ms. smith. Mr. warnock. Mr. kim. >> aye. >> Mr. gallego. Ms. blunt rochester. Ms. alsobrooks. >> aye.

▶ 0:56:11Chair Scott: >> 11 in favor and 13 opposed.

▶ 0:56:15Chair Scott: The amendment is not agreed to. I will go to britt 14.

▶ 0:56:24Sen. Britt: Thank you. This bill is bipartisan. It is very simple. It is widely supported and allows employees nonprofit organizations like public school teachers, ministers, nurses the same access to the 401(k) retirement plans that most americans can enjoy. Cit's offer a wider investment vehicle with lower fees and high returns and this allows them to participate in that.

▶ 0:56:54Sen. Britt: It levels the playing field so more hard-working americans can access more investment options and retire sooner. I want to thank senator warnock for leading this bill with me and a number of colleagues on this committee who have cosponsored it. I am committed to finding a vehicle for this to move. I am committed to making sure that the clarity act moves out today so we will look for a different vehicle and continue to build support.

▶ 0:57:21Sen. Britt: I withdraw my amendment but look forward to get this done.

▶ 0:57:26Chair Scott: I will call up warren 64.

▶ 0:57:29Sen. Warren: Thank you. This bill fails to address foundational caps on money laundering responsibilities for conventional crypto businesses and defi services. Even for the worst platforms this bill fails to restore sanctions authority to isolate them. While we are at war iran is openly gearing up to collect crypto fees from oil tankers to pass through the strait of hormuz.

▶ 0:58:00Sen. Warren: Terrorist groups, rogue states, foreign adversaries and criminals are using crypto to evade our sanctions and launder money. According to industry analysts, crypto crime jumped at least $154 billion last year driven by a 694% increase in crypto funds send to sanctioned entities.

▶ 0:58:31Sen. Warren: Sanctioned entities are receiving these. We need to fix the hole in our sanctions authority and crackdown on crypto money laundering. In 2022 the U.S. sanctioned a notorious mixer called tornado cash that had been used to launder more than $7 billion for criminals and foreign adversaries including more than $450 million for a north korean hacking group.

▶ 0:58:58Sen. Warren: These types of crypto services are designed to make it easy to launder a huge pile of money and making it hard for anyone including our law enforcement officials to tell where the money came from. They are a favorite tool for hackers, terrorist groups and sanctioned regimes. A court said a treasury needed congress, us, to act before it would be able to sanction the mixers like tornado cash.

▶ 0:59:28Sen. Warren: This amendment is simple, it restores the authority to isolate and sanction the centralized crypto platforms that repeatedly facilitate transactions with terrorist organizations like isis or al-qaida or with north korea, russia or iran. I urge my colleagues to support this amendment.

▶ 0:59:49Chair Scott: Senator lummis?

▶ 0:59:52Sen. Lummis: Thank you. The reason that is happening is because this bill is not law. When this bill becomes law, it includes robust provisions entitled to entitled t two and three to address illicit finance and sanctions and it focuses these provisions where they will be most effective.

▶ 1:00:16Sen. Lummis: For example, it provides law enforcement with the tools to trace and disrupt money laundering and clarifies sanctions and anti-money laundering requirements for digital asset entities. We want to discourage the illegitimate use of digital assets while encouraging the legitimate use. And we have found the balance in this bill. This amendment is not necessary. I urge that we oppose the amendment. >> Mr. chairman.

▶ 1:00:46Chair Scott: Senator kennedy.

▶ 1:00:49Sen. Kennedy: Do I have your permission to ask senator warren a question?

▶ 1:00:54Chair Scott: 15 seconds.

▶ 1:00:57Sen. Kennedy: Yes. Senator warren, I don't understand why this bill does not already accomplish the very worthy goal that you have articulated.

▶ 1:01:11Sen. Warren: May I answer?

▶ 1:01:14Chair Scott: 15 seconds.

▶ 1:01:16Sen. Warren: It is the tornado problem. You remember tornado, the mixer. This amendment says that the government can sanction and wall off a mixer like tornado. What purpose does tornado serve except to hide where the money came from and where the money is going and who needs to hide where the money came from and where the money is going to? Terrorists, money launder its, iran, sanctioned entities.

▶ 1:01:48Sen. Warren: All this is doing is saying let's give the power. It is not actually isolate them in the bill. Let's give the power to the government to say when this is what you are doing, they can isolate you when you are dealing with these bad actors. You are mixing up the money so that you advance money laundering.

▶ 1:02:08Chair Scott: Senator lummis and then the vote.

▶ 1:02:12Sen. Lummis: This bill provides for a study of the use of mixers and tumblers. They are a very complicated entity. Plus it provides $30 million to fincen which has the expertise to unravel mixers and tumblers and already has the tools it needs to enforce.

▶ 1:02:31Sen. Warren: Can I just say on that, yes, they have the expertise. But they do not have the legal authority. A court has said they need legal authority from congress so that they will be able to isolate these mixers. Right now they cannot do that. Put your money in if you are a terrorist. Go use tornado. And note that there will be virtually no chance of being caught. This is how iran can stay in the game and keep using its money.

▶ 1:03:03Sen. Warren: This is how north korea -- I'm sorry.

▶ 1:03:05Chair Scott: Senator lummis? The bill solves the problem?

▶ 1:03:10Sen. Lummis: Yes, title two and three. It is in illicit finance sanctions focused on providing law enforcement with the tools they need to trace and disrupt money laundering including mixers and some studies. Well, the law enforcement tools are also in this bill.

▶ 1:03:37Chair Scott: Clerk, call the role. >> chairman.

▶ 1:03:43Chair Scott: No. >> Mr. crapo. >> no. >> Mr. rounds. >> no. >> Mr. tillis. >> no. >> Mr. kennedy. >> no. >> Mr. hagerty. >> haggerty is no. >> Ms. lummis. >> no. >> Mr. ricketts. Mr. banks. Mr. cramer.

▶ 1:04:14Chair Scott: Mr. moreno. Mr. mccormick. >> no. >> Ms. warren. >> yes. >> Mr. reed. >> yes. >> Mr. van hollen. Ms. cortez masto. Ms. smith. Mr. warnock. >> aye. >> Mr. kim. Mr. gallego.

▶ 1:04:46Chair Scott: Ms. blunt rochester. Ms. alsobrooks. The vote is 11 in favor and 13 opposed.

▶ 1:04:52Chair Scott: The amendment is not adopted. Senator mccormick, you are recognized for two minutes.

▶ 1:05:00Sen. Mccormick: Thank you. To have the opportunity to introduce my amendment cosponsored by senator hagerty, there is a long history of bipartisan support for the sec and cftc to provide for portfolio marketing. The digital asset market clarity act directs the sec and cftc to issue rules that enable portfolio marketing across security, swaps, futures and digital commodity accounts held by registered dealers.

▶ 1:05:28Sen. Mccormick: This is intended to allow natural risk offsets among positions to be recognized and create greater efficiencies for investors to manage risks. For the portfolio marketing to function properly changes are necessary to ensure that customer protections under the securities investor protection act carried to cftc regulated products in the event that a broker-dealer becomes insolvent.

▶ 1:05:53Sen. Mccormick: This amendment gives the sec and cftc the flexibility to write rules with consultation from treasury on expanded security and portfolio margin accounts. Not only is this essential for customer protection during times of market stress, but the amendment explicitly prohibits cpic advances from covering digital commodities or swap positions that protect traditional security customers.

▶ 1:06:23Sen. Mccormick: Digital assets are being folded into the fabric of the financial system. This amendment recognizes that and this passage is important to every single market participant. The banks, crypto and customers. This amendment as a result of working closely with treasury and cpic and represents a bipartisan agreement with my democratic colleagues. I would ask to be adopted by voice but I am open to a roll call vote.

▶ 1:06:51Sen. Warren: I would like to respond. Section four or two of this bill directs the cftc and sec to issue a joint rule making that will facilitate portfolio marketing across a wide variety of categories, a lot of diverse instruments including crypto.

▶ 1:07:09Sen. Warren: As everyone here knows portfolio marketing allows the calculation of margin requirements based on the overall portfolio rather than by individual position and has the effect of lowering margin requirements for trading. Lower margin requirements increase leverage will be there for increased risk in the system.

▶ 1:07:31Sen. Warren: Excessive leverage in our financial system has time and time again then a cold bridge in crashes that harm not just the financial markets -- time and time again have been a culprit in crashes that harm not just the financial markets but spread to the real economy. This bill will unleash regulated crypto upon our economy. It will increase leverage across a range of different asset classes and regulatory regimes.

▶ 1:08:01Sen. Warren: I appreciate that the amendment takes steps toward protecting consumers from the havoc of this new regime but it is not enough. The amendment seems to remove civic protections from accounts with crypto which highlights one of the real paradoxes in this bill. It pushes more of the market into crypto and removes protections for investors and removes recourse for victims. That is the wrong direction to go in. When this blows up the economy, I hope everybody remembers.

▶ 1:08:32Sen. Warren: >> Mr. chairman.

▶ 1:08:34Chair Scott: I will stick with two minutes. Voice vote. All in favor say aye.

▶ 1:08:43Sen. Warren: I want a recorded vote on this. I think this one is going to matter in history.

▶ 1:08:49Chair Scott: The clerk will call the role. Aye. >> Mr. crapo. Mr. rounds. Mr. tillis. Mr. kennedy. Mr. hagerty. Ms. lummis. Ms. britt. Mr. ricketts. Mr. banks. >> aye by proxy. >> Mr. cramer. Mr. moreno. >> aye. >> Mr. mccormick.

▶ 1:09:20Chair Scott: >> aye. >> Ms. warren. >> no. >> Mr. reed. Mr. warner. Mr. van hollen. Ms. cortez masto. Ms. smith. Mr. warnock. Mr. kim. Mr. gallego. Ms. blunt rochester.

▶ 1:09:50Chair Scott: Ms. alsobrooks. >> aye. >> the vote is 18 in favor and six opposed.

▶ 1:09:57Chair Scott: The amendment has been adopted. Warren 52.

▶ 1:10:05Sen. Warren: Thank you Mr. chairman. When banks take excessive risks in pursuit of windfall profits, we know what happens next. The bets blow up, businesses on main street are shuttered, workers lose their jobs and retirement savings, families lose their homes and the economy goes into recession. And wall street comes to congress and begs for bailouts and gets them.

▶ 1:10:32Sen. Warren: That is why the laws are supposed to keep the banks safe by limiting the kinds of assets that banks can own and the activities they can conduct. There are plenty of traditional assets that banks are prohibited from owning and traditional activities that banks are prohibited from conducting. This bill would throw out the sensible restrictions on crypto assets.

▶ 1:10:57Sen. Warren: For example, the bill allows banks to transact a wild west of decentralized finance where a platform seems to face around, get hacked or otherwise implode pretty much every week. The bill allows banks to lend against crypto as collateral, to own crypto directly, to trade crypto derivatives and more.

▶ 1:11:23Sen. Warren: The bill repeals a key pillar of the dodd frank act for digital assets known as the vocal little -- volker rule. Bill allows bank holding companies to buy and sell digital assets for any investing purpose including the dangerous proprietary trading and hedge fund activities that caused the 2008 crash.

▶ 1:11:49Sen. Warren: Innocent businesses and families who have never heard of the block chain will suffer if the next crypto crash also causes a banking crash. My amendment would strike these dangerous provisions from the bill. I urge my colleagues to vote for warren 52.

▶ 1:12:11Chair Scott: 60 seconds.

▶ 1:12:15Sen. Lummis: There are three states that already allow banks to do this. One is virginia, wyoming and louisiana and after this bill passes, other states will be allowed to do it. The bank permissibility language confirms that banks can use digital assets to conduct activities that they already allowed to perform by law. The U.S. dollar is going to be digitized. It is going to be a digital asset.

▶ 1:12:43Sen. Lummis: So we need to integrate all of these assets into the banks that are allowed to do them to continue to do them. There are no special carveouts. This amendment would strike three key provisions of the bill related to bank permissibility, portfolio marketing and netting agreements. I urge my colleagues to oppose this amendment.

▶ 1:13:05Chair Scott: The clerk will call the role. >> the chairman.

▶ 1:13:09Chair Scott: No. >> Mr. crapo. Mr. rounds. Mr. tillis. >> no. >> Mr. kennedy. Mr. hagerty. >> haggerty is no. >> Ms. lummis. Ms. britt. Mr. ricketts. Mr. banks. >> no by proxy. >> Mr. cramer. Mr. moreno.

▶ 1:13:40Chair Scott: Mr. mccormick. Ms. warren. >> yes. >> Mr. reed. Mr. warren. Mr. van hollen. Ms. cortez masto. Ms. smith. Mr. warnock. Mr. kim. Mr. gallego. Ms. blunt rochester. Ms. alsobrooks. >> aye. >> 11 in favor and 13 opposed.

▶ 1:14:08Chair Scott: The amendment is not agreed to. Warren 66.

▶ 1:14:17Sen. Warren: Thank you. Jeffrey epstein was an early backer of crypto. He poured millions into coinbase, one of the biggest benefactors of this bill if it becomes law. That is no surprise. He recognized crypto's potential as the crypto ecosystem was new and just developing, there were

▶ 1:14:47Sen. Warren: Financial services epstein needed to facilitate his crimes. You might think that big banks would have severed their ties with epstein following his 2000 eight conviction for soliciting a child for sex. You would be wrong. For more than a decade, banks like j.p. Morgan, deutsche bank, bank of america generated massive fees off of epstein's business while ignoring very obvious red flags.

▶ 1:15:16Sen. Warren: It was not until epstein was arrested in 2019 that j.p. Morgan finally disclosed more than 4007 hundred transactions made between 1998 and 2013, totaling more than a billion dollars, two russian banks and young women.

▶ 1:15:40Sen. Warren: I have called on president trump's regulators to use their warrants to investigate bank executives that facilitated jeffrey epstein's crimes and to turn over any information to congress. So far, they have not lifted a anger. This would require federal banking regulators to publish any banking transactions related to epstein and his co-conspirators. What did banks know, and when did they know it?

▶ 1:16:09Sen. Warren: Did bank regulators spot anything that should have set off alarms? What was buried in confidential supervisory records? What will stop wall street and crypto companies from funding the next jeffrey epstein? >> Mr. chairman, confidential supervisory information is not germane.

▶ 1:16:40Sen. Warren: The epstein files have nothing to do with this bill. I urge my colleagues to oppose. >> can I ask a question on a point of order?

▶ 1:16:56Chair Scott: Sure.

▶ 1:17:00Sen. Kennedy: How are you defining this?

▶ 1:17:05Sen. Warren: This is what we want to find out. We don't have information. What we do know is that jeffrey epstein was using crypto early on, that he was involved in illicit financial transactions. And three of the largest banks --

▶ 1:17:23Sen. Kennedy: I get that. You say they have to release stuff about epstein and his co-conspirators. How are they going to know who was a co-conspirator?

▶ 1:17:34Sen. Warren: One who is identified is ghislaine maxwell, as an identified convicted co-conspirator. >> I look forward to you all continuing this conversation after the hearing. Let me call the roll. >> Mr. crapo? Mr. rounds? Mr. tillis? Mr. kennedy?

▶ 1:18:06Sen. Warren: Mr. hagerty? Mrs. brit? Mr. ricketts? Mr. banks? >> no by proxy. >> Mr. cramer? Mr. moreno? Mr. mccormick? Mr. reed? Mr. warner? Mr. van hollen? Ms. cortez masto?

▶ 1:18:38Sen. Warren: Ms. smith? Mr. warnock? Mr. gallego? Ms. blunt rochester? Ms. alsobrooks? The vote is 11 in favor and 13 opposed. >> this is not agreed to.

▶ 1:18:59Sen. Kennedy: Mr. chairman, I'm going to get in trouble I know, but I have a point of order. I would have considered voting for this amendment if you take out co-conspirators.

▶ 1:19:14Sen. Warren: Yes, the author of the amendment accepts. >> Ms. chair, point of order, the boat has been held. That would require an additional amendment at this time.

▶ 1:19:31Sen. Scott: I move on to number 90. >> my amendment allows the government to block foreign transactions using stable coins. This would primarily track down on iran's use of stable coins to support terrorist proxies, and engage with our forces at the present time.

▶ 1:20:01Sen. Scott: The blockchain analytics firm tearoom labs arranged cryptocurrency for sensitive goods, such as electrical equipment, ai, etc.. These unmanned drones are what is wreaking havoc on our forces and allies in the persian gulf today.

▶ 1:20:25Sen. Scott: We have lost 14 americans, and the money can be traced back, much of it, to stable coins. Iran is also accepting goals in stable coins, and they're making money on that. Treasury cannot shut down this operation.

▶ 1:20:51Sen. Scott: They have to go hat in hand to tether and go, please, will you voluntarily stop doing this? Every senator talks about how much they support the troops. Come up with money.

▶ 1:21:07Sen. Scott: : rebuttal? >> this already includes dedicated illicit financial sanction provisions. Title ii and title three of U.S. money laundering, sanctions complying, risk controls. The amendment creates a broad extraterritorial rule.

▶ 1:21:31Sen. Scott: I am concerned it could undermine responsible use of stable coins. I urge my colleagues to oppose senator reed's amendment. >> no. >> Mr. crapo? >> no by proxy. >> Mr. rounds? Mr. tillis? Mr. kennedy? Mr. hagerty?

▶ 1:22:01Sen. Scott: Mrs. brit? Mr. ricketts? Mr. banks? Mr. cramer? Mr.? Mr. mccormick? Ms. warren? Mr. warner? Mr. van hollen? Ms. cortez masto? Ms. smith? Mr. kim?

▶ 1:22:35Sen. Scott: Ms. blunt rochester? Ms. alsobrooks? The vote is 11 in favor and 13 opposed.

▶ 1:22:44Chair Scott: We know moved to number 100.

▶ 1:22:51Senator Reed: My amendment attempts to make the U.S. dollar the official currency of the united states of america, and it cannot be replaced by alternatives of legal tender. I was struck when it was said that the dollar will be digitized. If it is digitized, the dollar will no longer be controlled by the federal reserve.

▶ 1:23:21Senator Reed: And I don't think it is a good development for the united states, our economy, or the world. My amendment would also ensure that the dollar would not be trans -- transmitted by the chinese yuan. The dollar is going to be the currency of the united states. I heard today, the dollar will be digitized.

▶ 1:23:53Senator Reed: If we allow that, shame on us.

▶ 1:23:56Chair Scott: Rebuttal?

▶ 1:24:02Sen. Moreno: This is outside the scope of the bill before us. The clarity act as a market structure bill. It does not make crypto legal tender. It does not require any state to use could go. It does not disturb the status of the U.S. dollar as legal tender. This is to resolve an issue that is not necessary to the framework of the hearing. Let's keep the focus on a workable regulatory structure for digital assets, not add unrelated legal language.

▶ 1:24:32Sen. Moreno: On a personal note, in the 16, I became the first person in the united states of america to pay my taxes with bitcoin to show the capabilities of the technology. Had I met the senator from rhode island, I would not have done that. So I went absolutely be in a better spot had I not do that. We should have known each other back then.

▶ 1:24:55Sen. Reed: If I may, I will repeat again what the senator said. Dollars will be digitized. If we don't make it clear that digital currencies can and may supplant the dollar, it will be difficult.

▶ 1:25:20Chair Scott: We move on. I want to make the note that the $3000 of bitcoin today are worth how much? I want to make sure that point is clear. Call the roll. [local] -- [roll call]

▶ 1:26:54Chair Scott: To answer the question, it is $164,000. >> I want to start by thanking you and your staff. We have worked through thousands of hours on this. I cannot think of a piece of legislation that I have spent more time on. I voted for genius because I thought we needed a stable coin basis in this country.

▶ 1:27:20Chair Scott: And I think we need a market structure bill for this country as well. I look forward to continue working on this past committee. I also want to take a moment to acknowledge continued good faith . The series of bipartisan amendments we worked on this morning -- I absolutely troops that we can get this done.

▶ 1:27:47Chair Scott: My amendment come up for my friends sitting in the audience -- my republican parties and the white house accepted. We have worked dramatically since that time. We had made over 40 changes. Most of that will be included, I think, in the amendments. I still think there are issues to work through.

▶ 1:28:16Chair Scott: We have to make sure law enforcement has the tools it needs to make sure that actors cannot find a way to work around this framework, and officials cannot use these tools to enrich themselves. I'm committed to working to get a bill that moves this bill forward on the floor. I have been in crypto held up the last few months. I hope to get to crypto heaven.

▶ 1:28:46Chair Scott: I guess now I am in crypto purgatory. Thank you.

▶ 1:28:49Chair Scott: I will now call up -- before I do so, we are now 11:45. We are about 17 minutes left in the two hour window.

▶ 1:29:09Sen. Warren: I would like to continue.

▶ 1:29:12Chair Scott: I would call up senator van hollen.

▶ 1:29:19Sen. Van Hollen: Last year, the volume of digital assets involved in illicit activities loose through all previous records. By one estimate, 100 $54 billion was sent to illicit crypto wallets, up from 59 billion dollars in 2020 four. Decentralized finance services play an important role in this illicit ecosystem. I think we all know that.

▶ 1:29:46Sen. Van Hollen: Bad actors use tools to launder money, if a law enforcement, and move funds. Look at what north korean hackers did last year. They hacked 1.5 billion dollars from the crypto exchange and then used services and exchanges to switch between crypto tokens to launder funds and evade investigators. These are funds that can now help support the north korean nuclear program or other illicit activities.

▶ 1:30:17Sen. Van Hollen: Iranian actors have been documented using defiant techniques to launder funds and evade sanctions. In some cases, it is clear that these tools are created because their developers plan to profit from the illicit activity. They know that bad actors will exploit these tools. In fact, that is the whole point for some of them. We need to hold them accountable, addressing the illicit finance risk overall.

▶ 1:30:47Sen. Van Hollen: It is not straightforward. We know that. But this amendment is limited and simple. It would simply make it unlawful to release a d5 protocol for the purpose, the express purpose, of enabling money laundering, sanctions, evasion, and financing of terrorism. That is what it does. There should be consequences if you set out to enable drug traffickers, scammers, north korea, or iran.

▶ 1:31:16Sen. Van Hollen: I hope my colleagues would agree with that premise and support this amendment.

▶ 1:31:19Chair Scott: Rebuttal? >> in this bill, we have tried to use existing statutes and embed digital assets under that, whether it is the s.e.c. Or criminal penalties. So the same conduct that the gentleman is trying to address is already chargeable today under 18 U.S.a. 1956 and 1957, and existing sanctions laws.

▶ 1:31:51Chair Scott: If somebody builds a piece of software to evade sanctions, prosecutors can already bring cases under these statutes without needing a specific d5 add-on -- de-fi add on. To carve out one thing for a specific treatment would be a signal that de-fi software is not welcome in this country, and we don't want to send that strip -- that signal.

▶ 1:32:18Chair Scott: We want to use the existing strictures and embed digital assets in the U.S. for that reason, I oppose the amendment.

▶ 1:32:25Chair Scott: Clerk will call the roll. [roll call]

▶ 1:33:25Clerk: The vote is 11 in favor and 13 opposed.

▶ 1:33:27Chair Scott: Not agree to. We moved to van hollen 35.

▶ 1:33:32Senator Van Hollen: Thank you. This amendment is straightforward. It is designed to prevent conflict of interest and self-dealing by the president or members of the house or the senate. It also requires greater transparency. We have all seen the president and members of his family involved in corrupt crypto ventures and various crypto scams.

▶ 1:34:01Senator Van Hollen: To world liberty financial, the trump family has raked in billions in profits, most obtained through corrupt deals with members of the uae ruling family. We have heard testimony from witnesses before this committee about that. The trump and milani up meme queens have allowed trump to rake in hundreds of millions, if not more, in cash, even as investors lost four point 3 billion dollars.

▶ 1:34:32Senator Van Hollen: The way that scam works is that whether retail investors win or lose, trump always wins. What this amendment does is very simple. We are letting the american public know -- we're letting the people know -- that we are not going to allow self-dealing by the president or members of the house and senate and others, who have direct control and influence over these operations.

▶ 1:34:59Senator Van Hollen: As witnessed by the fact that we are marking up this bill. So the people involved directly in making these policies, from the president to the congress, should not be able to be issuers of these particular assets and coins. That is what the amendment does.

▶ 1:35:19Chair Scott: Rebuttal? >> this is the banking committee, not the judiciary committee. The inclusion of a criminal penalty that references the attorney general make this amendment not germane to this committee. It is out of order. I would also say that as a lawyer, you should if anybody respect the fact that people are innocent until proven guilty.

▶ 1:35:47Chair Scott: You are making comments about a person who serves this nation, and saying with no knowledge that he is committing a crime. It is a disgrace. We can have political conversations about policies. We don't have to turn everything into ad hominem attacks against the president of the united states.

▶ 1:36:08Sen. Van Hollen: Will the chairman allow me to respond briefly? I was clear, senator, that the deal with world liberty financial has all the markings of a corrupt deal.

▶ 1:36:25Sen. Van Hollen: As you know, the president decided to relieve some of the restrictions the united states had placed on chips and ai, just after those transactions occurred. He departed for his trip. There was the transaction even before the inauguration made in world liberty financial.

▶ 1:36:52Chair Scott: The point that senator moreno made -- our country still affords the individual a presumption of innocence. While we can continue the process of making allegations, I do think the senator's spot on. Rarely do I speak out when you two are having a conversation. I would be careful in this context. But let us move to a vote.

▶ 1:37:22Sen. Van Hollen: This amendment does not pass judgment on this issue. This just says the president, no matter who he is -- I used the word corrupt. There is a difference. [roll call]

▶ 1:38:30Clerk: The vote is 11 in favor and 13 opposed.

▶ 1:38:33Chair Scott: The amendment is not agree to. We will move to cortez masto.

▶ 1:38:39Sen. Cortez Masto: Thank you, Mr. chairman. Let me start by saying to my colleagues, thank you for working together. I think we have done so on a number of provisions in a bipartisan way, and I appreciate that. I also want to continue working with my colleagues. Senator rounds has been great to work with. Thank you. I look forward to continuing to work with you to move forward. Let me just say a couple of things.

▶ 1:39:05Sen. Cortez Masto: I am concerned that right now the clarity act would make it more difficult for law enforcement to capture criminals who use de-fi to move illicit proceeds. In response to the work we have been doing together on sections including this amendment, I have received letters from law enforcement opposing portions like this.

▶ 1:39:30Sen. Cortez Masto: Two letters from the national association who do the prosecution of that illicit activity. Two letters from the national district attorneys association. A letter from the fraternal order of police. In a letter from the county sheriff's of america and national association of chiefs of police, and the national association of police organizations. I asked to submit these for the record. Thank you.

▶ 1:40:00Sen. Cortez Masto: The reason why is my goal has been to find common ground. I think we have agreed that a true noncontrolling developer or software provider should not be subject, because they are not involved in this activity.

▶ 1:40:15Sen. Cortez Masto: The concern many of us have, including in law enforcement, is that the definition is too broad and the bad guys we are talking about are the ones that I think senator kennedy -- I'm sorry he is not here -- is asking questions about. They are carved out of these sections. So the goal would be to make sure that we are letting the good players still be able to innovate. We are not controlling developers. Let them do their thing.

▶ 1:40:47Sen. Cortez Masto: But not taking away the tools from law enforcement to be able to prosecute those individuals who pose really a public safety and national security threat. I'm talking about states like south korea and others. Excuse me. I am trying to move very quickly now. Let me finish this. Through north korea, iran, and others, who are using this terrorist activity, that are opposed to what we are doing here in the united states.

▶ 1:41:19Sen. Cortez Masto: Protecting our communities. I support the crypto regulation. I voted for genius last year and am ready to continue to work on this bill. But we need language to stop and punish these bad actors and give the prosecutors the tools they need to be able to do that.

▶ 1:41:38Sen. Moreno: To my colleague from nevada, thank you for your hard work on this and I think you are working in good faith to try to get to a resolution. I agree with the sentiment. But this amendment would strike critical protections for noncontrolling blockchain developers.

▶ 1:41:56Sen. Moreno: What makes this amendment particularly troubling is that section 300 one is specifically drafted to distinguish between so-called decentralized finance protocols that are decentralized in name only -- we came up with a name republicans don't always love. We call them dinos. And protocols that are generally decentralized and not operating behind-the-scenes.

▶ 1:42:20Sen. Moreno: If this legislation already recognizes this designation and provides regulatory standards, it makes little sense to simultaneously eliminate protections for developers of truly decentralized systems that lack a controlling intermediary. In practice, this amendment would introduce regulatory uncertainty. Here is what I would say.

▶ 1:42:44Sen. Moreno: Let's work together to figure out a way to get a landing spot where you are comfortable, we support law enforcement, and we make certain there is accountability.

▶ 1:42:58Chair Scott: Clark, call the roll. [roll call]

▶ 1:44:01Chair Scott: >> the vote is 11 in favor and 13 opposed.

▶ 1:44:02Chair Scott: The amendment is not agreed to. We call up smith number 119.

▶ 1:44:08Senator Smith: I would like to offer my amendment number 119. This amendment would incorporate senator durbin's no bailout for crypto act, which I joined him in introducing last year. We can agree that crypto assets are incredibly volatile. A single tweet can cause prices to fluctuate wildly.

▶ 1:44:33Senator Smith: Bitcoin, for example, lost nearly a third of its value since an all-time high in october. More than half since its peak. These are just two of the most dominant assets in the crypto market. Nearly $2 trillion worth of asset value was lost in a crypto crash in 2022. I am concerned in its current form that this bill we are considering today all but ensures that the next crash is even bigger than that.

▶ 1:44:59Senator Smith: What this amendment does is simply to prohibit federal agencies from bailing out the digital as industry, preventing U.S. taxpayers from being on the hook if that happens, when that happens. I want to thank senator durbin for his leadership on this issue. I urge my colleagues to support this amendment.

▶ 1:45:18Sen. Lummis: The clarity act does not authorize a bailout of the digital asset industry. It creates rules for the digital asked markets. It does not create a rescue fund, a guarantee, or a taxpayer backstop. The amendment is unnecessary and distracts.

▶ 1:45:39Sen. Lummis: We should be focused on building a clear regulatory framework, not suggesting that this bill authorizes something that it does not.

▶ 1:45:55Sen. Smith: This is a preventative measure that protects the taxpayers from future decisions.

▶ 1:46:03Chair Scott: Call the roll. [roll call]

▶ 1:47:04Chair Scott: >> the vote is 11 in favor and 13 opposed. >> I asked to be recorded is present.

▶ 1:47:09Chair Scott: The amendment is not agreed to. We will call up warnock 121.

▶ 1:47:18Senator Warnock: I intend to call an amendment which further strengthens this bill's consumer and investor protections. We made great progress over the past several months on negotiation, and I would like to thank senator lummis and chair scott for working with me on compromise provisions to ensure all consumers and investors are protected from fraud in digital assets.

▶ 1:47:48Senator Warnock: I regret that those compromises are not fully reflected in the text of today's bill. But I am hopeful that we can continue to work together on this, especially since the partisan part of this bill is so weak on consumer protection and it is a nonstarter for democrats on the floor. I do want to echo what my colleague, senator van hollen, and others have said.

▶ 1:48:16Senator Warnock: The president's self dealing with digital assets is pure corruption, and everyone in this room knows that. Whether his dealings are illegal is a matter of legislation and that is the work we are engaged in. But there is no doubt that this is pure corruption.

▶ 1:48:34Senator Warnock: The majority has refused to agree to enforce -- to enforceable guardrails around all elected officials -- all of us, including the president and the vice president, to prevent them from profiting from crypto when they are said to be serving the public. The public deserves to know that we are working for them and not for ourselves. The president's insistence on being engaged in this industry has cast a dark ball on the whole process.

▶ 1:49:05Senator Warnock: He should decide whether he wants to get this done or whether it wants to continue to enrich his family. Democrats have made it clear we will not accept a crypto bill that allows the president's crypto corruption to continue. We agreed the digital assets in the street 30, but I cannot support this bill in its current form.

▶ 1:49:25Senator Warnock: I look forward to continuing to work in a bipartisan manner with all of you on a bill that has strong ethical standards with strong consumer and investor protections. It is in that spirit of good faith compromise that I withdraw my amendment. I will not seek a vote. Thank you, Mr. chair, or reverend Dr. chair.

▶ 1:49:47Chair Scott: Thank you, senator Dr. reverend. I will now call up kim at number 20 four.

▶ 1:49:56Senator Kim: Thank you, chairman. I agree in innovation in financial services and want to harness the opportunity of emerging technologies. That is why I did support the genius act last year. I believe this innovation can be achieved while also working to stop cartels, state sponsors of terrorism, foreign terrorist organizations, from exploiting the technology. I worked for years on countering terrorist financing before I came into congress.

▶ 1:50:24Senator Kim: I saw how we find these important balances. I heard from industry leaders how they do not want their products and tools to be used by terrorist groups. They also said that a one-size-fits-all regulation is not the answer. They also said that frameworks of the past may not be fully equip bubble to the emerging technologies of tomorrow.

▶ 1:50:44Senator Kim: To those points, I agree, which is why I am offering this amendment to modernize the bank secrecy act by adding a new category of financial institutions that would allow us to go after cartels, state sponsors of terrorism, or foreign terrorist organizations that are trying to take advantage of the emerging technologies. At the same time, my amendment preserves innovation and growth for true de-fi because I know a one-size-fits-all framework does not work.

▶ 1:51:14Senator Kim: I support the technology developers, and I believe innovation can grow without allowing terrorist resources to grow. Let's meet the moment with a commonsense update while continuing to encourage innovation in the industry's here in the united states. I urge my colleagues to vote yes on this amendment. With that, I yield back.

▶ 1:51:34Sen. Lummis: This amendment is not needed because the bill in title already includes a section that accomplishes just what this amendment contemplates. It directs thin seven -- finsen to apply the digital secrecy act to digital brokers and exchanges, and it does it in a very precise manner.

▶ 1:52:02Sen. Lummis: So I encourage the proponent to check out title ii, and also look at titles two and three on money laundering and illicit finance. This bill, our bill, I think references the bsa 16 times. I don't think there is a single reference to bsa in the house-passed bill. We are really trying to get bsa into our bill. Thank you, Mr. chairman.

▶ 1:52:31Chair Scott: The clerk will call the roll. [roll call]

▶ 1:53:29Chair Scott: >> the vote is 11 in favor and 13 opposed.

▶ 1:53:30Chair Scott: The amendment is not agreed to. We will now call up gallego number 18.

▶ 1:53:38Sen. Gallego: Thank you, and thank you for the markup. This has been, to say the least, a long and difficult process. It has been great working with senator lummis, senator tillis. Ok time working with marino. [laughter] -- with moreno. [laughter] to be honest.

▶ 1:54:04Sen. Gallego: But we really have spent the better time of last year in countless meetings, long nights, working through holidays, to find common ground and legislate. This is what the process demanded of us. It is not an easy bill, as we all know. After working on the genius act, we all learned that solving issues on the front end was better legislation. We took that seriously here.

▶ 1:54:31Sen. Gallego: What congress is attempting to do is creating regulations for an entirely new sector of the financial system. It is a massive undertaking. 67 million americans own digital assets. We owe it to these people, many of whom are young and trying to achieve financial independence, to get this right. We cannot afford to wait. We also cannot afford to get this wrong. That is the balance we are trying to strike.

▶ 1:54:58Sen. Gallego: Through serious bipartisan negotiations, we have made incredible progress on this bill. We have narrowed the gap on many outstanding issues. We did serious bipartisan work on difficult questions about jurisdiction and disclosure requirements, to name a few. I want to be clear that my boat here does not guarantee a vote on the floor. After today, we need to connect with our colleagues and collapse negotiations into one, and all sit at the table.

▶ 1:55:27Sen. Gallego: We have come close but have not finished an agreement on an ethics guardrail for all elected officials. We need real, enforceable standards for what is and is not acceptable for someone who holds the public trust. It should not be an industry they enforce or regulate. We will continue to work. I am looking forward to working with Mr. tillis and the ranking member and chairman lummis.

▶ 1:55:57Sen. Gallego: I hope to see that we can move forward and hopefully finish this. I withdraw my amendment, number 18. I will, in committee, vote yes. But if this is not resolved by the floor, I will vote no. I hope we work together and come to a solution.

▶ 1:56:20Chair Scott: Thank you, sir. Senator alsobrooks has decided to offer senator warren the space she had for number seven. You will now hear from senator warren on amendment number 79.

▶ 1:56:39Sen. Warren: Thank you. The trump administration has spent the last year trying every trick in the book to kill the consumer financial protection bureau, the agency that has returned more than 21 billion dollars directly to consumers who have been cheated by banks and giant corporations. The acting director has dropped virtually all of the consumer agencies'ongoing enforcement actions against crooks and other bad actors.

▶ 1:57:06Sen. Warren: He has tried to lay off almost all of its staff and he has tried to drain its funding. A federal court has prevented trump and vogt from fully shutting down the agency. At the same time, a bill which would dramatically expand the risk of fraud in consumer and crypto markets -- the administration is busy trying to fire the cops responsible for protecting consumers.

▶ 1:57:36Sen. Warren: Remember, the cfpb is the agency responsible for fighting to cap abusive overdraft fees and late fees, to strike down medical debt from consumer credit reports, to protect servicemembers from being charged illegal interest rates on loans, to stop families who are being put out on the street with a illegal foreclosure. The cfpb is going to be more important than ever if we pass a bill unleashing new crypto scams.

▶ 1:58:07Sen. Warren: My amendment would ensure that the cfpb receives a consistent funding stream that is insulated from the kinds of political games the trump administration has been playing to undermine consumer financial in in this country. I urge my colleagues to support warren 79.

▶ 1:58:27Chair Scott: Senator moreno for rebuttal.

▶ 1:58:31Sen. Moreno: This amendment should not be adopted for one simple reason. The cpp budget is clearly out of the scope of this bill. It is not germane. I urge my colleagues to vote no this amendment.

▶ 1:58:50Sen. Moran: Can I use the 15 seconds I did not use? The cfpb was created in this committee because of fraud. If we are creating a new opportunity for expanded fraud, we need to make sure the cfpb is fully funded.

▶ 1:59:06Chair Scott: The clerk will call the roll. [roll call]

▶ 1:59:51Sen. Warren: Sorry. I was dazzled by the chairman. And gay by proxy. I am still dazzled. -- and yay by proxy. [roll call]

▶ 2:00:16Sen. Warren: Aye by proxy. Aye by proxy. [roll call] ask the vote is 11 in favor and 13 opposed.

▶ 2:00:53Chair Scott: About an hour ago, I received a request from a couple of democrat members to add five amendments to make this a bipartisan outcome.

▶ 2:01:10Supple Warren -- Sen. Warren: I object here. You cut 16 amendments from the members of this committee. You said these are our numbers. And now all of a sudden you have decided to rule back in three amendments taken from senator lummis that you additionally ruled out, because somebody gets a vote.

▶ 2:01:39Supple Warren -- Sen. Warren: You said as we started this that the rules are the rules and that you are not going to pick and choose and say this is going to help that move along or that move along, and you were going to apply the rules across the board. I understood that that was the case.

▶ 2:01:55Supple Warren -- Sen. Warren: If you are now going to rule arbitrarily that you have picked three out of the basket to add back in, three republican amendments to add back in, then I think you should rule that all of the amendments are back in. We would like all of the democratic amendments back in. I am particularly looking at cortez masto, number 16. This was an amendment that was requested by the national sheriffs association.

▶ 2:02:23Supple Warren -- Sen. Warren: It would close a massive loophole in the current bill that -- now, the current bill makes it harder for law enforcement to go after cartels and criminals. They are using decentralized platforms to launder money. Or how about we do reed smith, number 95. That is the amendment that would prevent deposit flight from community banks, which republicans are clearly afraid to vote on. It seems to me, Mr.

▶ 2:02:52Supple Warren -- Sen. Warren: Chairman, following the rules you announced at the beginning, either we know all the amendments when we walk in, or if you are going to start opening that up, let's open it up to everyone, not just three amendments on the other side.

▶ 2:03:10Chair Scott: Actually, the amendment we just voted on, number 79, was not agreed to. It was based on the approval of alsobrooks to have that amendment, and I did so. As a said, I have the right as the chairman to pick and choose which amendments they wanted.

▶ 2:03:29Chair Scott: Based on a bipartisan -- I am actually looking for republicans and democrats to have these final amendments included.

▶ 2:03:41Sen. Moran: With respect, Mr. chairman, if alsobrooks wanted to yield her spot over free to add another amendment, the consequence would suddenly be that lummis would get three amendments that have been ruled? Would that not be out of order? I don't understand this process. >> this is the wikipedia definition of no good deed goes unpunished. These were bipartisan nos.

▶ 2:04:09Sen. Moran: With the ranking member's objections, can we just get an agreement that they would be baked into an amendment on the floor? >> yeah, go ahead.

▶ 2:04:23Chair Scott: Less comment on the left.

▶ 2:04:30Sen. Warner: I would prefer come up because of the good faith that senator lummis has shown -- I intend to work more on this bill. I would hope -- this would move me much closer if these amendments are not cut off to the floor. >> then I clearly withdraw my comment. [laughter] >> point of order, Mr. chair.

▶ 2:04:58Sen. Warner: If you can include in my number 16, I would not be asking this question. But I'm trying to understand. Originally, 16 was not allowed because it was ineligible based on an error. So are these others. But now at the chairman's discretion, those would be allowed in, but this would not because it is still -- I am confused. Listen -- I respect that it is your call.

▶ 2:05:29Sen. Warner: Letting some in and some not, I am just trying to understand as we move forward.

▶ 2:05:36Chair Scott: It is a simple actual answer. We have an opportunity to do what I think is in america's best interest. It is possible both sides can find a path forward. In my opinion, finding that path forward requires me to allow lummis's amendments in the, because that was the request of democrat members to get to a bipartisan coalition solution.

▶ 2:06:06Chair Scott: So I have made the decision that treating both sides fairly requires me to listen to both sides. And now there are both sides coming to the table, both asking me to make a decision to allow amendments in. It is coming up upon me to make a right decision to allow these amendments in. We can do it the way tillis has recommended or the way warner recommended.

▶ 2:06:35Chair Scott: Supple warren me suggest -- democrats have not agreed to this. Three democrats agreed to this. But the democrats have not agreed to this. Let me ask the question the other way around, because I know you always want to be fair. You guys have the majority. You voted out everything the democrats tried to put in. What is the harm to letting us vote to more amendments that we wanted to vote?

▶ 2:07:04Chair Scott: One is supported by law enforcement. And one is supported by a community banks. We are not here to try to make this a longer process. You have the votes and could keep them out. But we would at least like to have an opportunity to vote on these two amendments. This is still an unusual process.

▶ 2:07:29Chair Scott: Otherwise, you have said I'm going to pick the people -- it is not the deal I like. You can get the same kind of parity. You can get the same kind of courtesy afforded each other. Let us vote on those two. I don't know what the harm is of voting. We get it. You will probably vote no.

▶ 2:07:55Chair Scott: Actually, I think it is for five amendments.

▶ 2:08:00Sen. Warren: I'm only asking two.

▶ 2:08:01Chair Scott: The answer is a simple one again. 1105, we informed your team that there was a bipartisan coalition asking for more amendments that I had taken out. I decided to listen to the bipartisan conversation and come to the conclusion that it is something to work on.

▶ 2:08:27Chair Scott: With senator warner and others, reinforcing my point, the best thing to do is to accept those amendments.

▶ 2:08:39Sen. Moran: I am concerned that law enforcement officials will wonder why their point of view could not be heard, the community banks will listen and wonder why their point of view could not be heard. That is all anyone is asking for, is two minutes afforded to them. A minute of rebuttal. And we are done. But we came in here and lift with the fact that we said you cannot do those, and there are republican things we cannot do as well.

▶ 2:09:09Sen. Moran: So the democratic position -- it should be it's all of them. But we are willing, I'm going to say on behalf of my colleagues --

▶ 2:09:20Sen. Cotton: -- chair scott: I call up lummis, number 122.

▶ 2:09:27Sen. Lummis: I would request a voice vote on this. Mr. chairman, I call up my amendment 122 and ask that page four, lines one and two, the stricken. And I urge its adoption. These are changes to clarify the circumstances in which a de-fi protocol is decentralized in name only and is actually controlled by a small group of persons.

▶ 2:09:57Sen. Lummis: And I want to thank senator warner for working with me on this.

▶ 2:10:02Chair Scott: Rebuttal?

▶ 2:10:09Sen. Warren: This amendment makes technical fixes to section 301 of the bill. It is hard to fix something that is fundamentally broken. Section 301 sets narrow tests on what counts as a crypto intermediary, that few will ever meet. It also incorporates section 604, the same loophole that shields decentralized services from basic anti-money laundering rules that law enforcement experts have stressed.

▶ 2:10:36Sen. Warren: It does not matter if you have rules if nobody has to follow them. The amendment does not fix any of those issues, and I urge all my colleagues to oppose this amendment.

▶ 2:10:47Chair Scott: I moved to strike pages four, lines one and two. All in favor, say aye.

▶ 2:10:58Sen. Warren: I call for a roll call vote. [roll call]

▶ 2:12:05Sen. Warren: >> the vote is 18 in favor and six opposed. >> Mr. chairman, on parliamentary inquiry. I understand there were some amendments that were disqualified. Senator lummis said some of those, and some of our colleagues had some of those. I understand we cannot put those back into the mix and have votes.

▶ 2:12:32Sen. Warren: I have amendments that were not disqualified at all, including van hollen 34, and fair disclosure. Those were written exactly right. Now, we are having votes on amendments you initially declared had not been correctly drafted, and not allowing me and others to vote on amendments that were in order and properly drafted. How does that make sense?

▶ 2:13:01Chair Scott: From the genius act, we came to a compromise on the number of amendments we were going to have. Ultimately, when the ranking member's side asks for comment, I gave our side five. I gave you all 15. The ranking member chose to figure out the 15 you would have. Ultimately, that is how we got here.

▶ 2:13:30Sen. Van Hollen: I will just say, in conclusion, Mr. chairman, I believe it is unprecedented to cap the number of in order amendments.

▶ 2:13:40Chair Scott: Actually not. It is not unprecedented. Every time we do a vote aroma -- vote-a-rama, we compromise on the number of amendments we have. We are doing it again. The clerk will now call the roll on the 18 to six of us.

▶ 2:14:11Chair Scott: We will move to the amendment itself, lummis number 122. As modified. [roll call]

▶ 2:15:29Chair Scott: >> the vote is 18 and favor and six opposed.

▶ 2:15:30Chair Scott: The amendment as modified is a great two. Senator lummis, you are now recognized. Microphone.

▶ 2:15:43Sen. Lummis: Asking for a voice vote on 120 trick -- 123. Mr. chairman, amendment 120 three makes bipartisan changes with respect to activities that are permissible for banks and credit unions to engage in digital as activities. These changes include clarifying the trading activity the banks can do, and extending applicability. I urge adoption and yelled back. -- and yield back

▶ 2:16:18Sen. Warren: This makes improvements to the part of the bill that drastically expands crypto-related activities at taxpayer insured banks. But this one falls far short. Inks would be able to transact in decentralized finance, lend crypto as collateral, trade crypto derivatives, and for.

▶ 2:16:44Sen. Warren: Why are republicans trying to divert american deposits away from small business lending and mortgage lending? This makes no sense. If the bill passes, even with this amendment, the next crypto crash could bring down the banks as well, and bring down the entire economy. Let's strike down this section instead of trying to tweak it along the edges and pretend that this fixes this.

▶ 2:17:12Sen. Warren: I urge my colleagues to vote no on this.

▶ 2:17:18Chair Scott: Call the roll. [roll call]

▶ 2:18:27Chair Scott: >> the vote is 19 in favor and five opposed.

▶ 2:18:28Chair Scott: The amendment is agreed to. I call up lummis 124.

▶ 2:18:33Sen. Lummis: Amendment 124 changes an or, st to ensure the s.e.c. Properly carries out rulemaking with the protection of investors and the benefit of our financial markets. I thank my democrat colleagues for bringing this amendment to my attention and I urge everyone to support it.

▶ 2:18:58Chair Scott: Senator warren for a rebuttal?

▶ 2:19:03Sen. Warren: Tokenization is one of the biggest problems with this bill. The fix that this amendment proposes in section 505 gives the idea of a finger leave a bad name. It is so inadequate. This amendment, through a minor improvement on the section, is not nearly enough to protect our system.

▶ 2:19:30Sen. Warren: The bill creates a system of easy regulation for crypto and easy ways out of securities regulation. And then to stop the inevitable flow of capital from traditional markets into crypto that this incentive system would cause.

▶ 2:19:49Sen. Warren: Section 505 ostensibly imposes a requirement of regulatory parity between securities and took a nice it would be one thing if the bill left it at that, but it goes on to weaken that fix by providing that the s.e.c.

▶ 2:20:09Sen. Warren: Actually can treat securities like assets differently in light of the new technological characteristics of crypto, or fences to protect investors. While the amendment would instead require the s.e.c. To base its exceptions on the unique characteristics of crypto , and whether there is anything in interest of the public.

▶ 2:20:33Sen. Warren: It does nothing to change the fact that this exception to the requirement of regulatory parity threatens to swallow the entire world.

▶ 2:20:41Chair Scott: The clerk will call the roll. [roll call]

▶ 2:21:44Chair Scott: >> the vote is 18 in favor and six opposed.

▶ 2:21:48Chair Scott: The amendment is approved. We will go to lummis 125.

▶ 2:21:55Sen. Lummis: I urge adoption of amendment number 125. This amendment adds a bipartisan provision to address insider trading for ancillary assets. I want to thank my colleagues on this committee for the work we did together on this amendment. I'm proud of all of us.

▶ 2:22:19Sen. Warren: At face value, this amendment applies existing security laws prohibiting insider trading to crypto. As a goal, I wholeheartedly support. If it were even close to enough to address the issue. But this amendment attempts to use a wine cork to plug a school bus-sized hole that is created in our securities laws by this bill.

▶ 2:22:48Sen. Warren: At its core, the bill provides easier rules for crypto and easy ways to escape security speculation, and get this more lax regulatory environment. Issuancts of securities only hae to put securities on the blockchain and self certified. Securities laws don't apply. The rules start to fall away. The movement calls for ancillary assets to be covered by insider trading prohibitions.

▶ 2:23:19Sen. Warren: It does absolutely nothing to address the fact that the bill has created so many instruments that share all the features of securities, not to be considered ancillary assets at all, and to be totally exempt from the securities laws, including the ones addressed by this amendment.

▶ 2:23:42Sen. Warren: While I support stamping out insider trading, this fix is far from adequate to address the issue. It leaves the country -- country with a sense they will be safe from insider trading and crypto. They will not be safe. The insiders are going to run away. I urge my colleagues to vote no.

▶ 2:24:04Chair Scott: The clerk will call the roll. [roll call]

▶ 2:25:11Chair Scott: >> the vote is 18 in favor and six opposed.

▶ 2:25:13Chair Scott: The amendment is agreed to. I call up lummis 126.

▶ 2:25:20Sen. Lummis: I move amendment number 126. I encourage its adoption. The purpose is to provide investor and consumer protection enforcement. This is bipartisan, to provide for a system of regulation of the author and sale of digital commodities by the s.e.c. And cftc. I think again my colleagues for working on this on a bipartisan basis. I urge adoption.

▶ 2:25:49Chair Scott: The ranking member is recognized for rebuttal.

▶ 2:25:54Sen. Warren: We should call this fig leaf number nine. This amendment claims to restore state-level consumer and investor protections and the ability of harm to investors to sue, but it is so riddled with exceptions and caveats it is pretty much meaningless. One of the bill's most serious fatal flaws is the state enforcement authority, a point that senator cortez masto has made over and over.

▶ 2:26:23Sen. Warren: I offered an amendment to comprehensively protect those authorities, but that amendment was blocked by the chair. I offered it because for decades state securities regulators have acted to spotlight cops on the beat, in all 50 states, rooting out fraud and scams in markets, particularly those that affect individuals for small dollar amounts that may not get priority from federal law enforcement.

▶ 2:26:49Sen. Warren: This provides a critical additional layer of enforcement capacity on top of federal watchdogs like the s.e.c. To make sure that every individual who is harmed has a chance of being made whole, and that the wrongdoers are held accountable. As the crypto industry has grown, so have the scams.

▶ 2:27:10Sen. Warren: As donald trump's federal regulators abdicate any responsibility for holding crypto criminals accountable, the state-label -- state-level cops are the law-abiding american's only line of defense. This protects investors from the worst fraud and market manipulation.

▶ 2:27:35Sen. Warren: But it also tramples on states rights, blocking state authorities from enforcing many of their own laws, including those that fight fraud and illegal conduct in these markets, and eliminating these protections are remedies that consumers have already under state law. This will leave crypto-holding consumers sitting ducks for fraud, and far worse off than they would be without any crypto market structure bill at all.

▶ 2:28:03Sen. Warren: If this amendment actually did something, I would support it. It actually only fools people. [roll call]

▶ 2:29:18Sen. Warren: >> the vote is 18 in favor and six opposed.

▶ 2:29:19Chair Scott: The amendment is agreed to. There are no further amendments. >> Mr. chair, I would like to offer reed smith 95. I know that this amendment has been ruled out of order.

▶ 2:29:32Chair Scott: There are no further amendments. The question is now on ordering the bill hr 3630 three, the digital asset market clarity act of 2025. The clerk will call the roll. The clerk will call the roll.

▶ 2:29:50Chair Scott: [roll call] >>

▶ 2:30:51Chair Scott: The vote is 15 in favor and nine opposed.

▶ 2:30:57Chair Scott: I ask unanimous consent that staff be allowed to make technical and conforming changes. Any objection? Hearing no objection, so ordered. Is there any member who would like to give a statement? Senator moreno?

▶ 2:31:16Sen. Moreno: First of all, I want to thank all my colleagues for your hard work on this. I think there is still work to be done on section 301 specifically, to make that better. Specifically, I want to call out my staffers, sophia and lindsay, for the hard work they put in. I'm sure all of you have met them. Give them a unanimous round of applause for their hard work. [applause] >> Mr. chair?

▶ 2:31:47Chair Scott: Senator alsobrooks?

▶ 2:31:52Sen. Alsobrooks: I would like to say a few words on the bill. The digital revolution is upon us, and it has presented a clear opportunity to support small businesses, generate wealth, and I believe spur innovation. The truth is, this digital revolution is happening with us or without us. Whether or not we regulate it to create rules of the road or not, it is here.

▶ 2:32:15Sen. Alsobrooks: I have a 20-year-old daughter and she and her peers have made it abundantly clear to me that they are interested in this invasion. They believe the digital revolution is important. They want not only to be able to participate in it safely, but they won't want every american months -- true and growing economic opportunity, the opportunity to become wealthy, to have generational wealth. That is why I am at the table.

▶ 2:32:43Sen. Alsobrooks: I have been in negotiations for over nine months, working toward regulating digital assets in a way that protects consumers and reduces the risk of deposit flight, while still allowing innovation to happen. I have negotiated in good faith with colleagues on both sides of the aisle and I want to thank them so much for all of their hard work. In recognition of that good faith, I have voted yes to advance the bill today.

▶ 2:33:09Sen. Alsobrooks: I want to be abundantly clear my vote today is a vote to keep working in good faith. It does not mean I will be voting for the passage of the clarity act on the floor, because we still have so much work to do. I am aware that we need to find a workable way to address law enforcement concerns about financial crimes. I am a former prosecutor and I know how important this is.

▶ 2:33:35Sen. Alsobrooks: We also need to incorporate an ethics agreement that would apply not only to the president and the vice president, but to all of us. The american people, especially my constituents, expect that from us. We need to work with our colleagues on the agriculture committee on their product, which still needs work. I will keep working with my colleagues to get this done.

▶ 2:33:58Sen. Alsobrooks: Americans from every background and every community deserve to benefit financially from this digital revolution, and to be protected from the risks that come with it. If we don't act, we will be left behind. I simply cannot let that happen.

▶ 2:34:16Chair Scott: Senator hagerty is next, and then senator tillis or senator britt. Then, ladies first.

▶ 2:34:29Sen. Hagerty: This creates a market structure for digital assets. It is going to supercharge innovation in american. The committee advanced the genius act and it has promoted a tremendous world leading framework. These are technical adjustments.

▶ 2:35:01Sen. Hagerty: I will think senator warner and senator moreno for working with me on this bipartisan fix.

▶ 2:35:06Chair Scott: Senator britt?

▶ 2:35:12Sen. Britt: Thank you for your leadership on this and everyone who took so much time and energy to help get this today, particularly senator lummis. You have put heart and soul into this, countless hours, because you want to make sure we innovate on our shores. It has been an honor to work with you on this and to watch you leave.

▶ 2:35:38Sen. Britt: Senator tillis and senator alsobrooks, thank you for your tireless advocacy to make sure that we get this right. Really for community banks -- there are a number of places where we have seen over burdensome regulations that were not intended to apply to a certain group. We know they are the lifeblood of our main street and small towns.

▶ 2:36:07Sen. Britt: This piece of legislation, in particular, senator cruz and I have a piece of legislation, the community bank relief act. There were amendments passed in 2010 ultimately that were about 7500 community banks during that time. Now today, there are fewer than 4500. I think there are several entities there that were never intended to be burdened by that regulation. I think we could fix it.

▶ 2:36:36Sen. Britt: That is one example of things we can do. I hope as we move forward that we will be committed to doing just that.

▶ 2:36:46Chair Scott: Senator tillis and senator blunt rochester.

▶ 2:36:51Sen. Tillis: Briefly, I wanted to associate myself with the comments made by senator gallego earlier about the work we have to do. And with respect to what senator alsobrooks just discussed, we are going to keep the same spirit of negotiations going that we have up to this point.

▶ 2:37:10Sen. Tillis: I want to thank senator lummis, because she and her staff, who deserves a long weekend, they all do, but especially chris -- I thank them for their hard work. I also want to talk to the stakeholders out here to let people know that I am in disagreement with some of the banking community, but I have been with them before and I'm going to be with them again. I'm willing to listen to ways we can make this bill better as it moves forward.

▶ 2:37:40Sen. Tillis: It really must move forward. The stakeholders are satisfied with the bill -- great. You have my recommend meant to treat you in the same professional manner I requested of my staff all along the way. And Mr. chair, thank you for your patience and thank you for your leadership in getting this marked down.

▶ 2:38:03Sen. Blunt Rochester: Mr. chairman, and ranking member, and to all of the members of the committee, and to all of my staff, we have spent countless hours, even through holidays, to work on this. That is because it is so consequential to our country and our economy. Because it is so consequential, it is important to get it right. For my state of delaware, we have more crypto atm's per capita than any other state.

▶ 2:38:35Sen. Blunt Rochester: We have had aarp come in. While they support the provision that was in it, they have not put out a statement that they support the whole bill, because there are still concerns. My community banks -- I am concerned still. Insider trading was one of the things that for me, people could understand. In this environment, there is a lot of concern.

▶ 2:39:01Sen. Blunt Rochester: What I hope, and while I am grateful to the group that has worked very hard and tirelessly, after the genius act, for me, I cannot take a handshake. I want the work to happen in committee. And a part that was really missing were hearings. There were a lot of members of this committee who said to me, I don't understand what this is. If we don't understand it, how can we legislate?

▶ 2:39:30Sen. Blunt Rochester: And so as we move forward, I appreciate the good faith efforts, and I think we still have work to do, and I look forward to working with my colleagues, but particularly on behalf of the american people, because this is too big for us to fail. I yelled back.

▶ 2:39:50Chair Scott: -- I yield back.

▶ 2:39:58Sen. Lummis: I want to add my thanks to everyone who has worked so hard. And the people who have informed the decision-making involved in this bill, particularly thanks to the folks from treasury, and from the white house. Honestly, without their involvement, I don't think we could have gotten as much done.

▶ 2:40:26Sen. Lummis: The agencies went from offering technical assistance to really rolling up their sleeves and helping with this bill. In our staffs, particularly my staffer -- I cannot say enough about your dedication to this. As I have said to chris many times, we are the docs that caught the tire. -- it kept spinning and our heads kept beating against the pavement.

▶ 2:40:57Sen. Lummis: We caught the tire and we are not going to let go of the tire until people on both sides of the aisle are satisfied.

▶ 2:41:08Chair Scott: Let me finally say this process has been one of the most informative and challenging processes I have been through as a united states senator.

▶ 2:41:23Chair Scott: I will also say that it has been one of the most transparent processes I have seen with members on both sides of the aisle and industry in the same room at the same time, hours upon hours upon hours. Any suggestion that somehow this was done without a process that is available to all members, undeniably, factually, false.

▶ 2:41:57Chair Scott: I will say that the members gallego, alsobrooks, warner, britt, rounds, lummis, and marino -- the number of hours you all spent talking to each other and getting to know each other better is unbelievable. How gallego and marino continue to talk is truly -- truly, all things are possible.

▶ 2:42:29Chair Scott: Thank god for that. I also want to acknowledge the fact that senator gallego worked with patrick witt from the white house, tons and tons of hours, trying to thread a needle. I will say that without patrick and the white house with democrats, this first step would not have been accomplished in a bipartisan fashion.

▶ 2:43:05Chair Scott: Working together with our staff -- it would not have been possible to find ourselves where we are today. I want to thank all staff, but particularly jamie and my staff, for their profound impact on this process. You all have worked, I know for sure, thousands of hours over the last three months, just on this piece of legislation. At 1:30 last night and at 4:00 a.m.

▶ 2:43:32Chair Scott: This morning, I am still getting texts from you all and responding. But literally, this process has been one that has been, I think, quite educational. I hope that we have a successful process. I know one thing for sure. When you say you were going to work on it, you mean it. Thank you for your dedication. And bless your family.

▶ 2:44:05Chair Scott: I appreciate you. We are going to get there at some point. Stay up on the court, no matter how you vote on the floor. With that, meeting adjourned.

Title

Senate Banking markup of the crypto market structure CLARITY Act

Purpose

The Senate Banking, Housing, and Urban Affairs Committee held an open business meeting to mark up H.R. 3633, the Digital Asset Market Clarity Act of 2025, which would create a joint SEC-CFTC regulatory framework for digital commodities. Chair Tim Scott (R-SC) and Ranking Member Elizabeth Warren (D-MA) clashed over the bill's consumer, national-security, and anti-corruption safeguards while the committee worked through dozens of amendments before voting to advance the bill. Begins at▶ 0:16:35

Who spoke

• Chair Tim Scott (R-SC)▶ 0:17:05: Framed the bill as protecting consumers, keeping innovation onshore, and safeguarding national security▶ 0:18:06; defended his rulings on which amendments were in order▶ 0:28:26, later allowed three additional Lummis amendments back in after bipartisan requests▶ 2:00:53, and the bill was ordered reported 15–9▶ 2:30:51.

• Ranking Member Elizabeth Warren (D-MA)▶ 0:21:06: Argued the bill was "written by the crypto industry for the crypto industry"▶ 0:22:03, noted Trump family crypto gains of $1.4 billion▶ 0:26:38, and offered numerous amendments on tokenization, sanctions, bank risk, and Epstein-related bank disclosures, most rejected on party-line 11-13 votes▶ 0:52:59▶ 1:14:17.

• Sen. Cynthia Lummis (R-WY)▶ 0:36:22: Called this the hardest bill of her career▶ 0:37:47, detailed AML and consumer provisions▶ 0:41:37, and later introduced a series of adopted bipartisan technical amendments (122, 123, 124, 125, 126)▶ 2:09:27▶ 2:18:33▶ 2:21:55▶ 2:25:20.

• Sen. Catherine Cortez Masto (D-NV)▶ 0:35:41: Raised a point of order that her amendment 16 was wrongly ruled out of order per the parliamentarian▶ 0:35:41; later argued the bill's DeFi definition is too broad and cited opposition letters from national law enforcement groups▶ 1:38:39.

• Sen. Thom Tillis (R-NC)▶ 0:45:15: Said AARP and law enforcement support the bill▶ 0:45:38, thanked negotiating partners, and stressed the need for a bipartisan vote out of committee▶ 0:46:37.

• Sen. Jack Reed (D-RI)▶ 0:47:32: Said in nearly 30 years on the committee he'd never seen amendments arbitrarily blocked▶ 0:47:59; offered an amendment to make the dollar the sole legal tender▶ 1:22:51, rejected 11-13▶ 1:33:25.

• Sen. Mike Rounds (R-SD)▶ 0:49:11: Offered an amendment (with Sens. Kim and Warner) requiring regulators to create AI innovation sandboxes▶ 0:49:11, adopted 15-9▶ 0:52:44.

• Sen. Katie Britt (R-AL)▶ 0:56:24: Offered, then withdrew, an amendment to expand 401(k)-style retirement plan access for nonprofit employees▶ 0:56:24.

• Sen. Bernie Moreno (R-OH)▶ 1:04:02: Argued Warren's sanctions/DeFi amendments were unnecessary given Titles II and III▶ 1:21:07; objected to Van Hollen's presidential self-dealing amendment as not germane to Banking Committee jurisdiction▶ 1:35:19.

• Sen. John Kennedy (R-LA)▶ 1:00:49: Questioned Warren on why the bill didn't already address mixers like Tornado Cash▶ 1:00:57; later said he'd have supported Warren's Epstein amendment without the "co-conspirators" language▶ 1:18:59.

• Sen. Ted Cruz / [Sen. Scott read roll] — (no distinct additional speaker; roll calls conducted by chair/clerk).

• Sen. Roger Marshall / David McCormick (R-PA)▶ 1:05:00: Introduced an amendment on portfolio margining across security, swap, and digital-commodity accounts, adopted 18-6▶ 1:09:50.

• Sen. Chris Van Hollen (D-MD)▶ 1:29:19: Cited $154 billion in illicit crypto flows▶ 1:29:19 and offered an amendment targeting DeFi protocols built to enable money laundering, rejected 11-13▶ 1:33:25; also offered an anti-self-dealing amendment naming World Liberty Financial, rejected 11-13▶ 1:38:30.

• Sen. Raphael Warnock (D-GA)▶ 1:47:18: Said the president's crypto dealings show "pure corruption"▶ 1:48:16 but withdrew his consumer-protection amendment in a spirit of continued negotiation▶ 1:49:25.

• Sen. Andy Kim (D-NJ)▶ 1:49:56: Offered an amendment modernizing the Bank Secrecy Act to target cartels and terrorist financing while preserving true DeFi, rejected 11-13▶ 1:53:29.

• Sen. Ruben Gallego (D-AZ)▶ 1:53:38: Noted 67 million Americans own digital assets▶ 1:54:31; withdrew his amendment but warned he'd vote no on the floor absent an ethics agreement▶ 1:55:57.

• Sen. Tina Smith (D-MN)▶ 1:44:08: Offered Sen. Durbin's "No Bailout for Crypto Act" amendment, rejected 11-13▶ 1:47:04.

• Sen. Jerry Moran (R-KS)▶ 1:59:06: Pressed for CFPB funding tied to crypto risk▶ 1:59:06; later argued for letting Democrats vote on two blocked amendments for parity▶ 2:07:29.

• Sen. Mark Warner (D-VA)▶ 2:04:30: Pushed the chair to include previously blocked amendments, leading Scott to reinstate three Lummis amendments▶ 2:04:30.

• Sen. Angela Alsobrooks (D-MD)▶ 2:31:52: Said she voted yes to keep negotiating in good faith but is not committed to a floor vote yet, citing unresolved law enforcement and ethics concerns▶ 2:33:09.

• Sen. Bill Hagerty (R-TN)▶ 2:34:29: Called the bill a supercharger for American innovation building on the GENIUS Act▶ 2:34:29.

• Sen. Lisa Blunt Rochester (D-DE)▶ 2:38:03: Noted Delaware's high concentration of crypto ATMs and said the committee still lacked adequate hearings on the bill▶ 2:39:01.

Key moments

• Warren said families are charged an extra $368 million a day in credit card interest while the committee works on crypto instead▶ 0:21:06, and that just 1% of voters rank crypto as a top concern per a CoinDesk survey▶ 0:22:29.

• Scott and Cortez Masto sparred over whether her amendment 16 was properly drafted; she said the parliamentarian told her it was in order and asked to submit that response for the record▶ 0:35:41▶ 0:36:09.

• Warren said crypto-related crime reached $154 billion last year, driven by a 694% rise in funds sent to sanctioned entities, and cited the $7 billion Tornado Cash laundering case including $450 million tied to North Korean hackers▶ 0:58:31▶ 0:58:58.

• On Warren's Epstein-disclosure amendment, Kennedy said he'd support it if "co-conspirators" language were removed, and Warren's author acceptance came too late because the vote had already been held▶ 1:18:59▶ 1:19:14.

• Chair Scott confirmed a rhetorical aside from earlier debate that bitcoin's value today is $164,000▶ 1:26:54.

• After the floor exchange over reinstated amendments, Scott acknowledged reversing course to add back three Lummis amendments following requests from Democratic members, prompting Warren's objection that rules were being applied selectively▶ 2:00:53▶ 2:01:10.

• Lummis's amendment 122, clarifying when a DeFi protocol is "decentralized in name only," passed 18-6▶ 2:12:05; her amendments 124, 125, and 126 on SEC rulemaking, insider trading, and state enforcement also passed 18-6 each▶ 2:21:44▶ 2:25:11▶ 2:29:18.

• The committee ordered the bill reported by a 15-9 vote▶ 2:30:51.

• Alsobrooks and Gallego both said their committee "yes" votes did not guarantee floor support absent further work on ethics guardrails and law enforcement tools▶ 2:33:09▶ 1:55:57.

• Warren said state securities regulators' consumer protections were being displaced by Lummis amendment 126, calling it "fig leaf number nine"▶ 2:25:54.

Metadata

Official title	Business meeting to consider H.R.3633, to provide for a system of regulation of the offer and sale of digital commodities by the Securities and Exchange Commission and the Commodity Futures Trading Commission.
Committee	Senate Banking, Housing, and Urban Affairs
Chamber / Congress	Senate · 119th Congress
Date	2026-05-14
Type	Open Business Meeting
Witnesses	(none listed in event metadata)
Video	senate-isvp
Transcript	391 caption blocks · 16,132 words · 2:44:28 runtime
Event	Congress.gov 338403