The post Capitol Hill Stalemate: DeFi Proposal Sparks Clash in Crypto Market Structure Talks appeared on BitcoinEthereumNews.com.

TLDR: A leaked DeFi proposal from Democrats labeled developers as intermediaries, alarming crypto advocates. Republicans paused crypto market structure talks after Democrats sent a new DeFi proposal on Wednesday. Senator Mark Warner’s office faced calls as the crypto industry criticized the DeFi regulation draft. With talks halted, passing a crypto market structure bill before 2026 now looks increasingly uncertain. Negotiations over U.S. crypto market structure have reached a standstill after a leaked Democratic proposal on DeFi regulation triggered industry backlash.  The new document, circulated among Senate Banking Committee staffers, quickly set off a wave of confusion and criticism. The crypto community and Republican lawmakers reacted within hours, questioning the intent behind the proposal. What began as steady progress toward bipartisan legislation has now shifted into political gridlock. The report, shared by Eleanor Terrett via Crypto In America, revealed that Democratic aides sent GOP counterparts a draft titled “Preventing Illicit Finance and Regulatory Arbitrage Through Decentralized Finance Platforms.”  The document outlined measures to regulate DeFi platforms by classifying anyone involved in designing, operating, or profiting from a front-end interface as an intermediary. Industry figures said the scope was overly broad and could undermine the decentralized model by driving developers offshore. NEW: Crypto Market Structure Talks Stall Over Leaked Dem DeFi Proposal Dems want the pen, Republicans want a markup, industry wants fair rules for DeFi: inside the market structure showdown on Capitol Hill. AND other top stories of the week. https://t.co/2J3jVUTboD — Eleanor Terrett (@EleanorTerrett) October 10, 2025 Industry Backlash Over the DeFi Draft Reaction from the crypto sector was swift. Developers, investors, and DeFi advocates flooded Democratic offices with concerns that the proposal could harm innovation.  Critics, including legal experts and fund executives, warned it could hand regulators sweeping control while raising constitutional questions.  Some described the draft as detached…

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Filed under: News - @ October 10, 2025 1:29 pm