The White House is considering withdrawing support for a major cryptocurrency market structure bill after Coinbase abruptly opposed the legislation, according to sources close to the Trump administration. The move threatens to stall legislative progress and deepens friction between federal policymakers and the digital asset industry at a sensitive stage of negotiations.
According to a PANews report, officials warned that support could vanish if Coinbase fails to offer a satisfactory yield-related agreement tied to the bill. Sources said the administration reacted angrily after Coinbase stepped away from talks without notice, just days before a key Senate Banking Committee markup.
Coinbase exited negotiations ahead of the scheduled Senate Banking Committee vote earlier this week, despite its earlier role in shaping the bill’s framework. The company’s move followed the release of a revised draft on Monday night, which Coinbase later described as containing too many unresolved issues.
CEO Brian Armstrong publicly opposed parts of the draft on Wednesday, citing concerns around privacy protections and the treatment of tokenized equities. That decision led the Senate Banking Committee to delay its markup session, creating uncertainty around the bill’s immediate future.
White House officials reportedly labeled Coinbase’s withdrawal a ‘rug pull,’ claiming it blindsided both regulators and industry participants.
White House Crypto Czar David Sacks commented on X that the current moment remains critical for setting clear regulatory rules. Senate Banking Committee Chair Tim Scott maintained confidence in bipartisan cooperation, though he offered no new markup date.
Committee member Cynthia Lummis issued a sharp response, saying Coinbase’s stance showed crypto firms remain unprepared for the regulatory clarity they seek. TD Cowen analyst Jaret Seiberg noted that Armstrong’s objections targeted provisions Democrats had already secured before the markup.
Seiberg questioned whether revisions could satisfy Coinbase while still preserving the bipartisan support needed to overcome a Senate filibuster.
Armstrong told CNBC that a revised CLARITY draft could return to markup within weeks, though no formal schedule exists. Lummis later told Politico that lawmakers would need time to reassess before restarting negotiations.
She also indicated that she would not re-engage right away, hinting at a cooling-off period following the sudden breakdown. Committee member Thom Tillis shared that thought, expressing his optimism about a successful markup in the course of this quarter.
At the same time, the Senate Agriculture Committee decided to delay the markup of its own market structure bill until January 27 due to unresolved issues. The committee has scheduled a release of the new draft on January 21, but it remains uncertain if the Banking Committee conflict will impact that timing.
As legislators rethink the course of action, a single question hangs over Washington: Will crypto legislation be able to make it through without the presence of industry unity in the negotiations?
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The White House may withdraw support for the crypto bill after Coinbase opposed the CLARITY Act, delaying Senate Banking Committee action. Lawmakers reacted sharply as negotiations stalled. The episode shows how industry decisions can disrupt US crypto policy timelines and reshape the path toward market structure rules.