The battle over major cryptocurrency legislation has moved beyond Washington as crypto companies and banking groups intensify their lobbying efforts in senators’ home states ahead of a crucial Senate vote next week.
The cryptocurrency industry has spent hundreds of millions of dollars supporting the Clarity Act, arguing that the legislation would give digital asset companies clearer legal rules. The Senate is scheduled to hold a procedural vote on September 15 that could determine whether the bill moves forward.
However, the legislation faces opposition from Democrats and some Republicans who argue that it does not provide strong enough safeguards and could create risks for the traditional banking system. Analysts say those concerns have made the bill’s prospects uncertain.
The congressional recess began on August 8, giving both sides an opportunity to campaign directly in senators’ home states. Crypto advocates and banking organizations have used opinion articles, letter writing campaigns and local events to build public support and influence lawmakers.
Mason Lynaugh, executive director of Stand With Crypto, said the group’s strategy during the recess has focused on showing lawmakers that crypto supporters are active across the country.
The organization says it has about 3 million advocates, including individual cryptocurrency supporters and technology entrepreneurs. Supporters have published opinion pieces in newspapers in states including Oklahoma, Kentucky and Kansas while also organizing events in Iowa, Michigan and other locations.
During August, the group said its supporters contacted members of Congress by phone or email nearly 50,000 times. It has also been helping arrange direct meetings between supporters and lawmakers.
Republican President Donald Trump has strongly supported the cryptocurrency industry and backed policies intended to encourage growth in the roughly $2 trillion digital asset market. The White House has also supported the Clarity Act.
The legislation is intended to address regulatory uncertainty by establishing which digital tokens should be treated as securities or commodities and determining which federal regulators would oversee them.
Crypto companies are pushing for the legislation to pass this year because polls suggest Democrats could regain control of the House of Representatives in the November midterm elections. Industry supporters view that possibility as a threat to what they consider a rare opportunity to establish comprehensive cryptocurrency rules.
The lobbying campaign is also being used to demonstrate the growing political influence of the crypto sector. The industry has already spent at least $190 million on political activity connected to the upcoming elections.
Banking Industry Pushes Back
Banking organizations have been campaigning against parts of the legislation, particularly provisions related to digital asset rewards. They argue that some aspects of the bill could create competition for traditional bank deposits and potentially affect lending.
The Independent Community Bankers of America has encouraged local bankers to meet senators in their home states and explain their concerns. The organization has also run television advertising urging lawmakers to change the legislation and protect traditional community lending.
The opposing campaigns have turned the congressional recess into a major lobbying contest, with both industries attempting to influence undecided senators before the September 15 vote.