Crypto Legislation: How Bills Become Law

Crypto legislation has proven extraordinarily difficult to pass in major jurisdictions, taking years from proposal to enactment and requiring the alignment of multiple competing interests. Understanding the legislative pathway — and the friction points within it — explains why crypto regulation has developed unevenly, why executive action and regulatory enforcement have filled gaps left by legislative delay, and why the GENIUS Act’s 2025 passage was a significant political achievement.

The US Legislative Process

In the United States, crypto legislation must navigate the full congressional process. Bills are introduced in either the House or Senate, assigned to a relevant committee (Financial Services in the House; Banking in the Senate for payments/stablecoins; Agriculture for commodities-related bills because of CFTC’s agricultural origins), and must survive committee markup — a process of amendment and vote that determines what reaches the floor. Successful committee markup leads to a floor vote in the originating chamber. If the other chamber has passed a different version of the same legislation, a conference committee reconciles differences before a final vote in each chamber. Presidential signature makes the bill law. Presidential veto can be overridden by two-thirds majorities in both chambers.

Jurisdictional disputes between financial committees — the House Financial Services Committee and Senate Banking Committee for securities-related crypto legislation, versus the House Agriculture Committee and Senate Agriculture Committee for commodity futures matters — create a structural barrier to comprehensive crypto legislation. FIT21 (the Financial Innovation and Technology for the 21st Century Act), which would have resolved the SEC-CFTC jurisdictional question for crypto, passed the House in 2024 with bipartisan support but stalled in the Senate because of Senate leadership resistance and Biden veto threats. The GENIUS Act (Guiding and Establishing National Innovation for US Stablecoins), which addressed only stablecoins, achieved the narrower focus that allowed the 68-30 Senate vote — a unusually bipartisan outcome reflecting the more limited regulatory perimeter and less intense jurisdictional conflict.

The EU Legislative Process

EU crypto legislation follows the ordinary legislative procedure. The European Commission publishes a legislative proposal, which is then considered in parallel by the European Parliament (specifically the ECON committee for financial legislation) and the Council of the EU (Finance Ministers, meeting in ECOFIN). Each institution develops its own position — Parliament through committee report and amendments, Council through working group negotiations producing a General Approach. When both institutions have positions, trilogue negotiations begin: informal three-party discussions between Parliament representatives, Council representatives (rotating presidency), and Commission representatives, mediated by the Commission. Trilogue produces a compromise text, which is then formally adopted by both Parliament and Council.

MiCA followed this path from October 2020 (Commission proposal) to June 2023 (adoption) — approximately three years, including a period of delayed progress during COVID and intense trilogue negotiations on stablecoin provisions. The process is slow because it requires consensus among 27 member states with different interests and different domestic crypto industry positions, and between a Parliament that typically seeks stronger consumer protections and a Council that reflects member state economic interests.

UK and Japanese Processes

UK crypto legislation proceeds through Parliament on the standard two-chamber model: HM Treasury consults, drafts primary legislation that goes through House of Commons and House of Lords, followed by statutory instruments (secondary legislation) for technical implementation. The Financial Services and Markets Act 2023 established the primary powers framework for crypto regulation; the detailed rules emerge through secondary legislation and FCA consultation papers.

Japan’s Financial Services Agency brings proposed legislation to the Diet (the Japanese parliament) through the Ministry of Finance. Japan moved earlier than most major economies on crypto exchange licensing (2017) and has refined its framework through successive legislative amendments, establishing a model of iterative legislative update that contrasts with the comprehensive single-statute approaches of the EU and US.

Why Crypto Legislation Is Slow

Three factors consistently slow crypto legislation. Jurisdictional disputes — between agencies in the US, between member states in the EU — require political compromise that takes time. Technical complexity means that lawmakers, staff, and advisors must invest substantial time understanding the technology and its implications before they can draft workable rules. And lobbying intensity — the crypto industry has consistently been one of the largest spenders in relevant policy cycles — generates well-resourced opposition to regulatory restrictions, requiring proponents of regulation to assemble coalitions that can overcome that spending. The GENIUS Act’s passage demonstrates that narrowly scoped, technologically specific legislation with genuine bipartisan support can succeed even in this environment.