“It’s Not Going to be an A+”

One senator compared passing crypto legislation to “giving dry birth to a porcupine” 07/02/2025

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The Things Money Can’t Buy

Between 2023 and 2024, House Financial Services Committee Chair French Hill received $38,000 from Coinbase and $17,500 from Andreessen Horowitz, according to the nonprofit OpenSecrets. The canny among you have observed that these very firms have reportedly exercised significant influence over crypto’s “market structure” legislation — law that would determine the rules of the road for some digital asset issuers and intermediaries. 

Don’t call me cynical, but as the old saying goes, follow the money. 

This is how politics in America works. The generous view goes like this: Companies make big-dollar donations, and then when they call the members of Congress, they pick up. Donors use this access to book time with the lawmakers, and if they use their time wisely, they can persuade those members of Congress to see things their way. 

The less generous is that big-dollar donors buy an implicit quid pro quo: do what we want, or the money faucet will run dry.¹ Or worse, we’ll fund your primary competitor. 

Behind the scenes, a16z and Coinbase have reportedly worked hard to jam market structure through. Still, money has its limits. These relationships between lobbyists and lawmakers must be mutually beneficial to endure, and legislators have more than one client to please. According to insiders close to the proposed law, the legislation may be skating on thin ice.

Despite a cadre of lawyers and near-bottomless budget, the law a16z and Coinbase have championed is starting to look tragically flawed. While proponents have framed that law, the Clarity Act (“CLARITY”), as “what the industry wants,” it has been picked apart by crypto lawyers who disagree. And this disagreement among stakeholders is starting to smell toxic in Washington. Decision-makers in Congress and the White House are beginning to look beyond the usual suspects for input on what to do about crypto. 

“They’re not just getting comments from the Coinbases or the a16z’s of the world. They’re also getting comments from the Bank Policy Institute, technical advice from the SEC, and comments from Democrat lawmakers who they want to get on board for a bipartisan coalition,” said one crypto lawyer deeply engaged in market structure discussions. “We want a bill that works, and that requires feedback from all stakeholders.” 

How It Started

Congressional pique with industry lobbyists boiled over last month during efforts to pass the GENIUS Act, a law that intended to standardize legal treatment of stablecoins that was heavily lobbied by the stablecoin issuer Circle. In a fireside chat last week, Senator Cynthia Lummis, whose office did not respond to requests for comment for this story, compared the process to “giving dry birth to a porcupine.” 

One committee staffer said Lummis’ porcupine analogy is apt, not just for GENIUS, but for all crypto-related legislation, including the Senate market version of a market structure bill that the chamber plans to advance at the end of September. “It’s going to suck. It’s not going to be fun. But you’re going to be really happy when it’s all over and you have a beautiful baby porcupine.” 

However, the margins for the GENIUS Act were thinner than expected. Though the final vote was bipartisan — 18 Democrats ultimately signed on — it wasn’t quite the “low hanging fruit” that many industry lobbyists expected it to be. Market structure legislation was always going to be tougher, and there’s growing concern that if only a few firms exert influence without buy-in from the rest of the industry, then persuading the whole of Congress is a lost cause. 

How It’s Going

That said, House Financial Services Chair French Hill is tasked with a trickier balancing act, in part due to the role crypto donors played in Hill’s campaign, according to key lobbyists and lawyers who spoke with Brogan Law. 

Hill’s committee has already approved CLARITY, a market structure bill heavily influenced by Coinbase and a16z. The bill was prepared for a floor vote before GENIUS encountered all that prickly friction in the Senate, and is a higher priority for his donors who want to see him give it the best chance possible — ideally by moving it forward for a floor vote at the same time as stablecoin legislation. 

But the politics has shifted. In fact, the President himself looked at what happened with GENIUS in the Senate and changed his demands. Whereas the White House was once telling Congress to pass both stablecoin and market structure legislation by August, the President told Congress in a Truth Social post last week to put the GENIUS act on his desk as soon as possible, and deal with market structure later. And this is a Republican party where the Trump is tantamount to a Tangerine God, where those who have opposed his legislative priorities elsewhere are threatened with a primary challenge, essentially the end of their career if Trump backs their opponent. 

So it was a bit of a surprise when Hill told an audience at the Brookings Institution a few days after Trump’s Truth that Republican lawmakers would “figure out how we’re going to move both the idea of stablecoin and market structure ahead.” 

Making Everybody Happy

According to sources familiar with Hill’s thinking, his strategy isn’t as simple as defying Trump to appease Coinbase. Rather, Hill is hoping to move the CLARITY , alongside the GENIUS, forward in one vote series, but still leave some flexibility for separate final votes. Under this approach, both bills would be considered simultaneously, and potentially advanced with one procedural vote, though they could be split for final passage if Speaker Mike Johnson so chooses. Sources noted this strategy remains fluid and may evolve.

This strategy allows Hill to simultaneously give his chamber’s version of a market structure bill — which, bear in mind, his committee’s staff has worked on for years if you count their work on an earlier version from last Congress — a shot at passing without jeopardizing the passage of stablecoin legislation. It also allows Hill to keep his donors Coinbase and a16z, who want to see market structure move forward, happy while also appeasing the president’s demands to put stablecoin legislation on his desk as soon as possible. However, the CLARITY would need overwhelming bipartisan support in the House in order to pressure the Senate to move forward with the House’s legislation rather than their own.

Spokespeople for Johnson and Hill did not respond to requests for comment. Spokespeople for a16z and Coinbase also did not respond to requests for comment. 

Nobody’s Perfect 

The takeaway from all of this is that, while in January it might have seemed like crypto’s biggest donors and loudest industry groups would win the day on market structure, it now seems more likely that a final bill will be a compromise between disparate groups’ preferences. 

What that actually means for the bill text is evolving. CLARITY, which mostly maps to a16z and Coinbase’s preferences, will probably face some major amendments if it makes it to the Senate. Senate Banking Committee staff wouldn’t specify what changes they’re considering, but the fact that the committee is writing its own bill signals that CLARITY is far from a consensus pick. Chair Scott has said the committee could release a discussion draft by the end of the month.

In response to a request for comment, a Senate Banking committee spokesperson directed Brogan Law to a document outlining the committee’s principles for market structure legislation, released last week. 

A Senate Banking Committee staffer told me that no single lawyer—or company—is going to get everything they want. “With crypto, this is par for the course. There’s this collision of money and ideology, and it gets really messy, because you wonder, ‘do you think this because it’ll benefit your business? Or do you genuinely believe it?’” 

Either way, they said, industry players should manage their expectations. The bill “is not going to be an A+, but if we can get a solid B, where there is a good test and some degree of clarity, and it’s workable, then that’s great,” they said. 

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Three sources who have been privy to these conversations said that Coinbase, a16z, and Ripple had been reminding members of Congress that the PAC Fairshake, to which they each contributed heavily, is watching how members of Congress vote on crypto legislation as it decides where to spend money in the midterms. Fairshake did not answer a request for comment. Brogan Law Link: https://broganlaw.substack.com/p/its-not-going-to-be-an-a