/>iIt’s been an eventful stretch in crypto law and regulation. The Senate passed the GENIUS Act — the first major federal crypto bill to clear the chamber’s 60-vote threshold needed to overcome a filibuster — which would establish clear federal guidelines for stablecoin issuance, governance, and custody. Legislative activity continues to accelerate in Congress, with the Senate also holding its first hearing focused squarely on crypto market structure. Meanwhile, the long-running SEC v. Ripple case appears to finally be drawing to a close — albeit without the court’s blessing on the parties’ proposed settlement.
These developments and a few other brief notes are discussed below.
SEC v. Ripple Settlement Agreement Nixed by Trial Court; Appeals Still Dropped: June 26, 2025
Background: Back in May, Judge Torres denied the parties’ joint request to approve a final proposed settlement of the SEC v. Ripple matter. The parties went back to do the legwork that Judge Torres found lacking in their initial attempt, and Judge Torres has once again denied request, ruling that “the parties do not have the authority to agree not to be bound by a court’s final judgment that a party violated an Act of Congress in such a manner that a permanent injunction and a civil penalty were necessary to prevent that party from violating the law again.”
Analysis: On one hand, it’s always troubling when a court gets between two parties trying to settle a matter. On the other hand, it is hard to fault Judge Torres, who watched the SEC spend immense administrative and judicial resources over a half-decade period only for the SEC to do a complete about-face after the matter concluded. As Judge Torres ruled, the SEC briefed that “without an injunction, Ripple would continue to disregard the laws of Congress in a manner that would hurt investors,” so hard to accept the SEC effectively asking the court to ‘disregard’ its own prior statements. Ripple announced it was dropping its appeal, so this appears to be the end of the matter.
Senate Digital Asset Subcommittee Holds Market Structure Hearing: June 24, 2025
Background: The Senate Banking Subcommittee on Digital Assets held a hearing titled Exploring Bipartisan Legislative Frameworks for Digital Asset Market Structure. The same day, Senate Banking Committee Chair, along with 3 other Republican colleagues, released their proposed digital asset market structure legislation principles, which appear to align with the CLARITY Act currently pending in the House. The hearing was sparsely attended, with only five of the eleven subcommittee members making an appearance and Senator Alsobrooks (sitting in for Ranking Member Gallego) being the sole Democrat to attend.
Analysis: Having already passed stablecoin legislation, the Senate is turning its eye to market structure legislation. However, the sparse attendance could indicate that priorities lie elsewhere while the Senate waits to see how the House handles the CLARITY Act and GENIUS Act. That said, this was the first Senate hearing on market structure that seemed less exploratory and more focused on actual legislative text goals — a positive step. It looks like the goal is for market structure to be through both chambers of Congress by the end of September, which is ambitious to say the least, but an aggressive timeline gives market structure a chance of passing this year.
Stablecoin Bill Passes in Senate on 68-30 Bipartisan Vote: June 17, 2025
Background: As expected after clearing cloture, the GENIUS Act (as amended) has passed the Senate and now moves on to the House for its consideration. The bill requires most stablecoin issuers to be approved and overseen by federal financial regulators such as the FDIC, OCC, and Federal Reserve, while allowing states to approve issuance under $10 billion, as long as the entities are regulated at the state level under similar frameworks. The bill was amended to win over pro-crypto Democrats seeking stricter rules for nonfinancial and foreign stablecoin issuers. The scope of payment stablecoins is limited to centralized tokens, meaning they are issued and managed by a single entity that maintains full control over the reserves, with real world 1:1 backing, such as stablecoins backed by treasury instruments or the U.S. dollar. This is the first crypto bill to pass the Senate’s 60-vote majority needed to overcome Senate filibuster rules, unlike the Senate’s 2024 disapproval resolution for the SEC’s Staff Accounting Bulletin, which only required a simple majority under the Congressional Review Act and was ultimately vetoed by President Biden.
Analysis: There are currently enough votes in the House to get this passed and onto the President’s desk, where he has said he would sign the bill into law in its current form. However, there are ongoing talks in the House to try to link the GENIUS Act’s passage with the CLARITY Act market structure legislation, which will face a much steeper path to passage. Hopefully, the GENIUS Act doesn’t get tripped up right before the finish line by efforts to tie it to broader legislation efforts. Effective market structure legislation could be truly transformative for the industry, but there is a “bird in hand” argument for locking in a stablecoin win now instead of trying to do everything at once and ending nothing. Even if the GENIUS Act is signed into law, products such as Euro-pegged stablecoins, algorithmic stablecoins, and yield-bearing stablecoins have yet to be addressed.
Briefly Noted:
Payments Article: “How Stablecoins Could Transform Merchant Payments” by the Coinbase-led Payments Innovation Council is a great reference on how stablecoin payments can be implemented by businesses. The full protocol described in the article outlines a model compliant with existing payment processing laws (including smart-contract-enabled escrow for chargebacks) while potentially saving companies significant fees.
DAO Governance Study: Practitioners in the space should read this recent study on governance centralization in decentralized autonomous organizations (DAOs) and its drivers and economic implications. “Our findings suggest that DAOs thus far fall short of delivering the promise of decentralized governance.”
Fed Reputational Risk Examinations Over: The Federal Reserve has joined the OCC and FDIC in ending “reputational risk” examinations for banks it oversees. This is part of a wider effort across agencies and Congress to require firm metrics for banking examinations rather than basing examinations on industries a bank services.
Bitcoin Backed Mortgages: Federal Housing Finance Agency’s Director, Bill Pulte, has directed the agency to study consumers’ use of crypto holdings for mortgage qualifications and a letter directing Fannie Mae and Freddie Mac to consider crypto for mortgage loan risk assessments.
Prediction Markets/Funding Stays Hot: Kalshi, one of the leading prediction markets permitted in the U.S. after winning their dispute with the CFTC last year, is reportedly raising $185 million in a Series C at a $2 billion valuation. Polymarket also reportedly closed on a $200 million raise at a $1 billion valuation. The M&A activity is also starting to provide venture funds with liquidity for new investments.
In-Kind Redemptions Coming: ETF purchasers are going to be given the option for in-kind redemptions in the near future. So people can buy in or sell ETF positions without exiting the underlying asset. There are still tax compliance issues to work through before this becomes a reality, though.
FTX Creditor Distributions Begin: FTX’s bankruptcy estate started its first wave of creditor distributions on June 24, 2025, with some customers reportedly seeing higher-than-expected recoveries thanks to crypto market gains. Additional payouts are expected to continue into 2026.
Supreme Court to Hear ’40 Act Matter: The U.S. Supreme Court has agreed to hear a case that would settle a split between the Circuits as to whether there is a private right of action under the Investment Company Act of 1940, or the ’40 Act. Courts had long held that there is no such right of action until SDNY, and then the 2nd Circuit found that the ’40 Act contains "rights-creating language" that a court can't deny a rescission claim for violation of the statute. While this doesn’t directly implicate crypto, many crypto and DAO structures potentially implicate the registration provisions of the Investment Company Act. If there is a private right of action, there may be another fairly broad avenue for class action plaintiffs to bring new claims.
Conclusion:
From stalled settlements in federal court to ambitious timelines for market structure legislation, digital asset law in the United States remains in flux. While the GENIUS Act’s bipartisan support offers a rare moment of legislative clarity, efforts to tie it to broader market reforms could still jeopardize its path forward. At the same time, regulatory agencies continue to refine how they treat crypto-related activities, from stablecoin payments to mortgage underwriting. As always, the space moves fast, and legal practitioners will need to keep pace with a landscape that is being rewritten in real time.
