Trump's 'personal intervention' likely needed to advance crypto market structure bill, TD Cowen says

A crypto market structure bill is unlikely to advance in Congress unless President Donald Trump personally intervenes, according to investment bank TD Cowen, as industry divisions and political hurdles continue to complicate efforts to reach a deal.

"Our view is that it will require President Trump's personal intervention to force the crypto and banking industries to make the compromises needed for crypto market structure legislation to have a chance of advancing in Congress,” said Jaret Seiberg, managing director at TD Cowen’s Washington Research Group, in a Monday note. His comments came as White House crypto czar David Sacks hosts a meeting today with banking trade groups, crypto trade groups, and Coinbase to discuss potential compromises on market structure legislation.

The meeting is expected to focus on a key sticking point in the Senate Banking Committee: how stablecoin rewards should be treated. Banks have warned that allowing crypto platforms to pay rewards without clear limits could pull deposits away from the traditional banking system, particularly from community banks. However, some crypto firms, including Coinbase, argue that banks are using the issue to limit competition and say the question of stablecoin rewards was already addressed during negotiations around the GENIUS Act, which was signed into law last July.

According to Seiberg, the debate goes beyond whether crypto platforms should be allowed to pay interest or rewards on stablecoins. He views such payments as “inevitable,” but said the real questions are when platforms would be granted that authority and what level of regulatory oversight they would be required to accept. From the banking industry’s perspective, Seiberg said stablecoins are unlikely to pose a meaningful threat to deposit pricing until they are widely used for everyday transactions. Before that point, he sees stablecoins as a greater competitive risk to money market mutual funds.

Seiberg also pointed to tension within the crypto industry itself. Legal ambiguity has acted as a barrier to entry, he said, benefiting some incumbent crypto platforms by limiting competition. Clear market structure legislation could encourage regulated institutions, including large banks and broker-dealers, to become more active in digital assets. At the same time, Seiberg noted that regulators such as the Securities and Exchange Commission and the Commodity Futures Trading Commission are likely to deliver many of the policy outcomes the crypto sector has been seeking, potentially reducing the urgency for legislation among some industry players.

Bigger obstacle to crypto legislation

Still, Seiberg argued that industry infighting may not be the biggest obstacle. The more significant challenge is securing enough Democratic support in the Senate, where as many as 10 Democrats would be needed to pass a bill. Those lawmakers are expected to push for stronger investor protections, tougher anti-money-laundering and Bank Secrecy Act standards, and stricter conflict-of-interest rules that crypto companies may oppose, Seiberg noted.

Democrats are also likely to insist on provisions barring the president, senior government officials, and their families from owning or controlling crypto entities, Seiberg said. He added that this issue was already a major sticking point and has become even more sensitive following a recent Wall Street Journal report alleging that an Abu Dhabi royal agreed ahead of Trump’s inauguration to invest $500 million in World Liberty Financial. While the report has not been confirmed, Seiberg said its publication adds pressure on Democrats to hold their ground.

"We are not saying legislation is impossible in 2026. Industry could get on the same page and the GOP could give Democrats enough concessions for it to pass. It is that the path forward is getting harder rather than easier," Seiberg concluded.