Who Sets XRP's Rules? Lummis Calls Clarity Act Final Ahead of Tuesday Vote

Lummis: As Good as It Gets

Senator Cynthia Lummis has declared the Digital Asset Market Clarity Act finished, rejecting fresh Democratic demands for changes hours before a Senate vote on the measure that has kept XRP's regulatory status in limbo. The Wyoming Republican, a lead sponsor of the market-structure bill, told a Washington policy summit on Monday that the compromise text circulated over the weekend marks the end of the line. “The Democrats want more,” she said. “They always want more. If we waited another month, they would want more.” Lummis, who has worked on the legislation for more than five years, counted 114 individual policy concessions already made to Democrats. Among the largest was the section curbing officials' personal business ties to the crypto industry — aimed chiefly at President Donald Trump — where she said Trump unexpectedly accepted a second round of ethics constraints in this week's draft. She praised her Democratic counterpart, Senator Kirsten Gillibrand, even as she argued the negotiation had given away enough. The bill now faces a procedural vote on Tuesday requiring 60 yes votes to advance, and lobbyists at Monday's industry event described passage odds as narrow at best. “This is as good as it's going to get,” Lummis said. “My tank is empty.”

Warren's Staff Counters

Resistance from the Democratic side sharpened on Monday. Staff for Senator Elizabeth Warren, the top Democrat on the Senate Banking Committee, circulated arguments against the revised ethics compromise, contending that the new enforcement powers granted to state attorneys general are largely illusory. In their reading, the state-level mechanism does not provide a genuinely independent way to enforce the bill's restrictions. The staff also flagged a timing gap: restrictions on issuing or sponsoring digital assets would generally apply only to assets launched after the provisions take effect, potentially leaving existing tokens outside the tightened rules. The ethics dispute is not the bill's only problem. A bipartisan group of 18 state attorneys general, led by New York Attorney General Letitia James, urged lawmakers a day before the procedural vote to reject the legislation, warning it could weaken states' ability to pursue cryptocurrency fraud. Parts of the industry object as well — the latest text narrowed protections from the Blockchain Regulatory Certainty Act (BRCA), drawing criticism from crypto policy advocates. And a pivotal Republican is undecided: Senator Susan Collins of Maine called the more than 600-page bill a “moving target,” citing its new ethics provision and unresolved questions about community bank deposits.

circulated arguments against the revised ethics compromisehttps://x.com/BrendanPedersen/status/2099585285084315912

Eight Banking Groups Push Back

Eight major banking trade organizations wrote to Senate leaders John Thune and Chuck Schumer on Monday urging that the bill not advance in its current form. The signatories include the Bank Policy Institute, the American Bankers Association, the Consumer Bankers Association, the Financial Services Forum and the Independent Community Bankers of America. Their concern centers on payment stablecoins — the instruments behind PayFi on-chain payments — which they say could carry interest or yield-like incentives that pull serious deposit volume out of the banking system and reduce lending capacity, with community banks and deposit-dependent lenders most exposed. The letter dismisses the draft's “circuit breaker,” a mechanism meant to cap deposit flight, as no real safeguard because it would only trigger after significant outflows had already occurred. The groups also warn that issuers or their affiliates could route around a direct interest ban through alternative rewards, and they ask leaders to explicitly cover direct and indirect interest or returns on stablecoin holdings, strike narrowing language from the text, and prohibit incentives economically equivalent to deposit interest. They say they back a comprehensive framework for digital asset markets, but argue the current draft fails to stop stablecoins from draining bank deposits. Readers tracking the market in real time can follow live spot and futures prices on MEXC.

Whose Text Wins?

Stripped of the theater, this fight is about who gets to decide what the Clarity Act actually says — and the only authority that settles that is the text itself. As circulated this week, the bill is a proposal, not law: nothing in it binds the SEC, the CFTC or the states until both chambers pass it and it is signed, and its rules would phase in on effective dates set after enactment. What Tuesday's 60-vote test decides is whose interpretation — Warren's staff, the 18 attorneys general, the eight banking groups or Lummis — becomes the operative one. The bill's jurisdictional redraw matters most for XRP's cross-border settlement role, which sits squarely in the seam between market-structure regulators, so the XRP regulation question stays open until that text becomes binding.