Senate Banking Committee Chairman Tim Scott reportedly predicts that 12 to 18 Democrats will support comprehensive crypto market structure legislation.
According to Aug. 19 reports, Scott is conducting individual meetings with Democratic members, including those outside the Banking Committee, to build bipartisan backing for the anticipated September bill introduction.
The South Carolina Republican’s outreach efforts follow the House passage of the Digital Asset Market Clarity Act on July 17, which received support from 78 Democrats in a 294-134 vote.
The House legislation establishes jurisdictional boundaries between the Securities and Exchange Commission and the Commodity Futures Trading Commission while creating registration pathways for qualifying digital asset platforms.
Scott released a discussion draft of the Responsible Financial Innovation Act of 2025 on July 22 alongside Senators Cynthia Lummis, Bill Hagerty, and Bernie Moreno.
The Senate proposal builds upon the House CLARITY Act by introducing ancillary asset definitions, modernized disclosure requirements, and banking provisions that allow financial holding companies to offer digital asset services.
Regulatory framework development
The CLARITY Act directs SEC and CFTC coordination through joint registration processes for platforms listing tokens that meet functional decentralization tests and public float requirements.
Qualifying networks fall outside the securities law scope once they achieve sufficient decentralization metrics.
The legislation establishes token disclosure requirements scaling with market capitalization tiers while requiring issuers conducting US sales to submit initial information statements.
Banking supervisors receive instruction to recognize qualified custodians managing both stablecoins and digital assets under unified segregation and audit standards.
The framework creates coordinated custody requirements for platforms operating spot and derivatives trading under shared regulatory oversight between the two primary federal agencies.
The Senate discussion draft expands these provisions through ancillary asset classifications covering digital tokens that avoid securities designation.
Regulation DA would exempt certain ancillary asset sales from registration requirements for annual proceeds under $75 million, capped over four-year periods.
The proposal refined investment contract definitions under federal law while establishing pre- and post-launch transparency requirements for digital asset issuers.
Senator Lummis emphasized the urgency of regulatory clarity to prevent American innovation migration overseas, stating the legislation will establish clear distinctions between digital asset securities and commodities while modernizing regulatory frameworks.
Senator Hagerty noted that outdated laws and regulatory uncertainty have hindered innovation and left consumers without adequate protections.
Lastly, the Banking Committee issued a Request for Information covering more than 35 topics to support rulemaking processes, with public comments informing final legislation development.
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