Published & Updated: January 29, 2026
Since returning to office in January 2025, President Trump has made cryptocurrency one of the most aggressively pursued areas of financial policy reform. Through a January 2025 executive order creating the Digital Asset Market Working Group, repeated public endorsements of making the United States the “crypto capital of the planet,” and support for bipartisan legislation, the administration has accelerated momentum on two landmark bills: the CLARITY Act (dividing SEC/CFTC jurisdiction) and the GENIUS Act (federal stablecoin framework). As of late January 2026, both measures are advancing in the Senate after House passage in 2025, though partisan friction, winter weather delays, and intense lobbying over stablecoin yield rules continue to create hurdles. This comprehensive guide covers the current status of the key bills, the ongoing stablecoin yield controversy, implications for Bitcoin reserves and market structure, and what traders & investors should watch in the coming months.
Current Legislative Status – January 2026 Snapshot
| Bill | Key Objective | House Status | Senate Status (Jan 2026) | Next Milestone |
|---|---|---|---|---|
| CLARITY Act | Define “digital commodity” vs security; grant CFTC spot authority over non-security tokens | Passed (bipartisan, 2025) | Senate Agriculture Committee markup rescheduled to Jan 29, 2026 after weather delay | Committee vote → full Senate floor |
| GENIUS Act | Federal framework for stablecoin issuance; 100% reserve requirement; yield ban for consumer protection | Passed (July 2025) | Banking Committee reconciliation ongoing; yield carve-out negotiations active | Full Senate vote expected Q1–Q2 2026 |
| FIT21 (precursor) | Initial CFTC/SEC jurisdictional split | Passed (2024) | Stalled → folded into CLARITY | — |
The Senate Agriculture Committee markup of the updated CLARITY Act (now incorporating “Digital Commodity Intermediaries Act” language) is scheduled for **January 29, 2026 at 10:30 AM ET** after a weather-related postponement from January 27. Democrats led by Sen. Kirsten Gillibrand have signaled willingness to negotiate amendments on stablecoin yields, SEC enforcement discretion, and innovation exemptions, raising hopes for bipartisan passage in Q1 2026.
Stablecoin Yield Controversy – The Biggest Remaining Sticking Point
The GENIUS Act (passed by the House in July 2025) establishes a federal licensing framework for stablecoin issuers, requiring 100% high-quality liquid reserves (cash + short-term Treasuries), monthly audits, and consumer protections. The most contentious provision prohibits yield-bearing stablecoins for retail holders — a rule banks and traditional finance firms support, but many crypto-native issuers (Tether, Circle, Paxos) and DeFi platforms argue stifles innovation.
Key debate lines:
- Pro-yield camp: Yield is essential for competitiveness vs. bank deposits and T-bills (currently ~4–5%); banning it pushes activity offshore.
- Anti-yield camp: Yield-bearing stablecoins resemble unregistered securities and create run risk; consumer protection demands separation of payments from investment products.
- Current negotiation: Democrats propose carve-outs for institutional / accredited-investor yield products while keeping retail versions non-yielding; Republicans push for broader allowances.
Resolution of the yield question is now the primary gating factor for GENIUS Act passage in the Senate.
CLARITY Act – Defining Digital Commodities vs Securities
The CLARITY Act seeks to end the long-standing SEC vs CFTC jurisdictional turf war by creating clear definitions:
- Digital commodity: Non-security token with sufficiently decentralized governance and functionality → falls under CFTC spot market oversight
- Security token: Investment contract-like tokens → remains under SEC jurisdiction
- Mature blockchain test: Removes SEC registration requirement for tokens on sufficiently decentralized networks
- Intermediary licensing: New category for digital commodity brokers/dealers with tailored compliance
Updated Republican draft (released Jan 21, 2026) expands CFTC authority while addressing Democratic concerns on enforcement discretion and innovation exemptions. Senate markup on Jan 29 is expected to include bipartisan amendments before committee vote.
Trump’s Bitcoin Reserve Policy & Broader Crypto Vision
President Trump has repeatedly stated his intention to make the United States the “crypto capital of the planet,” including:
- Establishing a strategic Bitcoin reserve (no sales of government-held BTC)
- Supporting pro-crypto legislation (CLARITY, GENIUS, FIT21 successor)
- Appointing crypto-friendly regulators (Paul Atkins nominated for SEC Chair)
While the reserve policy remains aspirational (requires Congressional approval), it has already influenced market sentiment and institutional positioning.
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- Risk control: Max 1–2% account risk per trade; trailing stops below recent lows
Conclusion & What to Watch in Q1 2026
The Trump administration’s aggressive push for cryptocurrency market structure reform — through the CLARITY Act (CFTC/SEC jurisdiction split) and GENIUS Act (federal stablecoin framework) — remains on track for potential passage in Q1–Q2 2026. Senate Agriculture Committee markup on January 29 will be the next critical milestone for CLARITY, while yield-ban negotiations are the primary hurdle for GENIUS in the Banking Committee. Trump’s “crypto capital” vision, including a proposed Bitcoin reserve, continues to shape sentiment despite needing Congressional approval. t
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Disclaimer: Cryptocurrency trading involves significant risk of loss. Legislative outcomes are uncertain and subject to change. This article is for informational purposes only and does not constitute investment, legal, or financial advice. Always conduct your own research (DYOR) and never invest more than you can afford to lose completely.
