Proposed legislation seeks to clarify token classifications and federal oversight
WASHINGTON | January 14, 2026 — U.S. senators late Tuesday circulated draft legislation intended to establish a clearer regulatory structure for cryptocurrency markets, prompting adjustments across global digital-asset trading desks as spot liquidity and derivatives positioning responded to fresh policy signals.
According to reporting confirmed by people familiar with the matter, the draft bill outlines how digital assets would be classified under U.S. law and proposes clearer jurisdictional boundaries between federal regulators. The proposal follows months of industry pressure for market-structure clarity and renewed debate in Congress over oversight of rapidly expanding crypto markets.
The legislation would seek to distinguish when digital tokens fall under securities law and when they would be regulated as commodities, assigning primary oversight of spot crypto markets to the Commodity Futures Trading Commission, according to the draft text circulated on Capitol Hill.
The release of the Senate draft bill triggered immediate repositioning in Bitcoin and Ethereum markets, with traders citing regulatory clarity as a driver behind shifts in spot liquidity and derivatives exposure during U.S. and Asian trading hours.
Market participants said Bitcoin and ether traded near recent ranges during European and Asian sessions, while funding rates in perpetual futures tightened modestly as desks adjusted leverage. Liquidity in large-cap tokens remained concentrated on major exchanges, while activity in smaller altcoins thinned as traders rotated toward higher-liquidity assets.
Data reviewed by this publication shows spot trading volumes in Bitcoin and Ethereum rose modestly following the bill’s release, while open interest in BTC futures edged higher, indicating measured risk repositioning rather than broad speculative inflows.
Traders in New York said options markets reflected slightly firmer demand for short-dated hedges, while desks in London reported cautious adjustments to exposure ahead of potential committee discussions later this week. In Asia, traders in Singapore and Hong Kong pointed to increased activity during local morning hours as global desks digested the legislative text.
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Industry sources noted that the draft also addresses elements of the stablecoin market, an area that has drawn scrutiny from both banking regulators and lawmakers. The language, which remains subject to revision, is expected to be a focal point in upcoming negotiations.
Funds and market-making desks adjusted positioning by reducing leverage and favoring assets with deeper liquidity, according to traders, as regulatory developments added a layer of headline risk to near-term market structure.
Analysts said the draft represents one of the most substantive attempts in recent months to provide a framework for U.S. crypto markets, though they cautioned that legislative hurdles remain. Debate is expected to continue around decentralized finance and compliance standards as the bill moves through the Senate process.
Global markets continued to monitor developments in Washington, underscoring the influence of U.S. policy on digital-asset liquidity and institutional participation across regions.
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Global Markets Desk | DECODE THE CRYPTO
covers global crypto markets, regulation, and institutional trends.