Crypto Courted Both Parties. Now It May Have to Choose.

Support for the Clarity Act is thinning, even among co-sponsors.

This is what I imagine my sources look like on the other end of the call.

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Bipartisanship or Bust

In case you haven’t heard, it’s “Crypto Week” in the House of Representatives. At the start of the week, Republican House leadership planned to send GENIUS—a bill regulating stablecoins—to the president’s desk, and to advance two others to the Senate: Digital Asset Market Clarity Act (Clarity), which establishes rules of the road for crypto trading, and a bill banning central bank digital currencies. Crypto lobbyists and Republican staffers have been sleeping at their desks since Friday.

Getting those bills passed has been anything but smooth sailing. Thirteen Republicans in the House Freedom Caucus obstructed a procedural vote yesterday afternoon to advance the crypto bills, blindsiding Republican leadership and crypto lobbyists. Their actions have thrown Crypto Week into chaos, and left the bills advocates’ rushing into stressful emergency meetings in an attempt to get the week’s agenda back on track.

But is that stress shared? Aside from a few outspoken critics dubbing it “Anti-Crypto Corruption Week,” most Democrats have been notably quiet. A press release announcing the week’s agenda touted the “bipartisan” nature of these bills four times—yet didn’t include a single quote from a Democrat.

That silence raises a question: are the Republicans leading this effort genuinely willing to collaborate across the aisle, or is talk of bipartisanship cheap? And if Democrats aren’t on board, does crypto legislation stand a chance in the Senate?

“There are no Democrats participating in this so-called ‘Crypto Week’ which bodes ill for the chances of lasting legislative solutions for the crypto markets,” said Eli Cohen, General Counsel at Centrifuge. “Why not make it a joint announcement? Why not reach out to Angie Craig?”

The Silent Minority

In the leadup to Crypto Week, California Representative Maxine Waters, the ranking Democrat on the House Financial Services Committee, published a flurry of essays and press releases opposing all three bills. Despite this, most insiders view Waters’ activity as noise. She and her supporters have been firm “no” votes on each piece of legislation since they were in committee. These Democrats, at least, view the focus as easy publicity for opposing what some perceive as Donald Trump’s pet industry.

And despite this partisan opposition, crypto lobbyists are still cautiously optimistic that all three bills will pass the House this week. Republicans hold 220 out of 435 seats, so if they can get the Freedom Caucus members in line, they don’t need Democratic support.

Nonetheless, much rides on Clarity’s performance. The sometimes controversial bill, which is backed by many¹ industry heavyweights, needs a strong bipartisan vote to survive. That’s because the legislation will take 60 votes in the Senate, and 60 votes need Democrats. A strong vote in the lower chamber would “jam” the Senate, making the House bill difficult to ignore. Without it, the Senate may start over with its own bill, delaying regulation and risking failure.

So rather than focus on Waters, lobbyists are more concerned about the many other moderate Democrats who don’t have strong views on the legislation. As of writing, a whip count² used by industry lobbyists estimated that at least 28 Democrats would vote for Clarity, with 21 undecided.

House Agriculture Committee Ranking Member Angie Craig, who co-sponsored the bill and recently called it an “important step forward,” has been cagey in recent weeks. Lobbyists still count her as a “yes,” and she told Semafor that she wanted her colleagues to support the bill on Monday, but her apparent ambivilence about the bill’s future is becoming deafening. Others, like Virginia’s Eugene Vindman and California’s Salud Carbajal, appear to be wavering as well, despite previously supportive comments and “yes” votes in committee. Even Minority Leader Hakeem Jeffries remains a question mark — though he’s de facto advocated for the bill by choosing to not whip votes against it, and was spotted attending a crypto fundraiser in May.

Spokespeople for Representatives Craig, Vindman, Carbajal and Jeffries did not respond to a request for comment.

Bipartisan Burnout

Even with a poignant silence in leadership, three Democrats spoke out against Waters to urge their fellow Democrats to join the GOP in supporting Clarity³ on Monday. But GOP leadership isn’t exactly extending the hand to these would-be allies. “This is one of those promises Republicans have made to crypto, and they just want to get the win,” explained one Democratic operative. “Maybe they get some Democrats, great, but there’s no need to appease them.”

Strategically, some Republicans see value in "owning" crypto as a partisan issue. The Republican party struggles to fundraise aside from the money Trump pulls in, and having the industry which spent more than anyone else last election on side helps fill the money gap with Democrats. That thinking is part of what made House Freedom Caucus members’ defection on Tuesday such a surprise.

For Democrats, the fundraising divide has only become an issue recently, and many younger leaders say it hasn’t quite sunk in with the party establishment. That’s why Democratic crypto lobbyists have taken up the strategy this week to argue that supporting crypto is both popular and financially strategic. On Monday, they met with lawmakers to pitch the idea that a “no” vote could invite retaliation from crypto super PAC Fairshake in 2026. Fairshake also released a press release highlighting its fundraising, subtly reminding lawmakers it’s watching how they vote.

Money Over Power

But even crypto insiders doubt donations alone can shift Democratic votes the way they’ve shifted Republicans. “If the Fairshake folks don’t all vote for [Clarity], then what is the industry to do with their political spending?” asked one person who worked with multiple crypto donors last cycle. “Was the bipartisan approach the right approach? Are they going to go all-in on Mike Johnson the next two election cycles? Will they accept that the ‘program’ didn’t work?”

That makes the vote on Clarity not just a policy milestone, but a litmus test: Can crypto money keep this issue bipartisan? Because only with bipartisan support, advocates say, can crypto get the regulatory clarity it’s been seeking.

“If everything passes with bipartisan support, and the regulators work in an open fashion, then these are effective, lasting rules,” explained Cohen.

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The DOJ vs. DeFi

Not all the action is in D.C. this week, though. The trial of Roman Storm, a developer of the Tornado Cash protocol, also kicked off in New York.

Storm was indicted by the DOJ on three charges: conspiracy to commit money laundering, conspiracy to violate sanctions, and conspiracy to operate an unlicensed money-transmitting business. The protocol he co-developed with Roman Semenov and Alexey Pertsev anonymizes cryptocurrency transactions in such a way that makes it very difficult even for these two founding developers or law enforcement to decode who is the sender and the receiver.

Because of that, bad actors like the North Korean government began using it. And while the developers couldn’t control the protocol once it was released, the DOJ argues they should still be held responsible. Meanwhile DeFi advocates, including the DeFi Education Fund, Coin Center, and Paradigm say the case sets a dangerous precedent for blockchain innovation.

It’s still early days in the trial. Jury selection took up most of Monday and Tuesday morning, and opening arguments began Tuesday afternoon. But the case is worth watching—not only because of its implications for DeFi developers, but also because, regardless of whether you agree with the DOJ, it represents a test of the agency’s stance on crypto. In April, the DOJ published a memo saying it would no longer charge developers with money transmission violations. But in Storm’s case, prosecutors merely abandoned the argument that he failed to register properly—leaving the broader case intact.

“The stakes of this matter are high: an unfair result could chill not just software development and innovation in crypto and fintech, but have ripple effects on the broader open source, AI, and technology communities alike,” wrote Paradigm Chief Legal Officer Katie Biber and General Counsel Gina Moon in a blog post. “Between the Southern District of New York and the Court itself, we urge common sense, due process, and fairness.”

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1. But not all - plenty of industry lawyers and political operatives have their criticisms which we’ve covered several times in this newsletter.

2. i.e., a spreadsheet tracking the number of representatives who have verbally committed to voting one way or another

3. but even their language has gotten soft, citing their own disappointment with the bill’s “shortcomings.”