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Senators reach deal to limit crypto regulation, and Treasury won’t oppose it

Janet Yellen, U.S. Treasury secretary, arrives at a Eurogroup meeting of European Union (EU) finance ministers in Brussels, Belgium.

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An amendment in the bipartisan infrastructure bill that would limit a proposal to increase federal regulation of cryptocurrencies was blocked Monday afternoon.

Sen. Pat Toomey, R-Pa., brought the amendment up for unanimous consent. Sen. Bernie Sanders, a progressive independent from Vermont, then blocked GOP Sen. Richard Shelby’s attempt to add defense funding to it.

The infrastructure bill itself is on track to pass the Senate on Tuesday morning.

The defeat of the crypto amendment came hours after the Treasury Department said it would not oppose a bipartisan agreement that limits a proposal in the infrastructure bill to increase federal regulation of cryptocurrencies.

“I am grateful to Senators Warner, Portman, Sinema, Toomey and Lummis for working together on this amendment to provide clarity on important provisions in the bipartisan infrastructure deal that will make meaningful progress on tax evasion in the cryptocurrency market,” said Treasury Secretary Janet Yellen in a statement out Monday afternoon. “I am also thankful to Chair Wyden for his leadership and engagement on these important issues.”

Earlier, Toomey and Sens. Mark Warner, D-Va., Cynthia Lummis, R-Wyo., Kyrsten Sinema, D-Ariz., and Rob Portman, R-Ohio, said they were negotiating with Treasury to reconcile two competing amendments over how broadly to define the definition of a broker.

“We’ve worked with the Treasury Department to clarify the underlying text and ensure that those who are not acting as brokers will not be subject to the bill’s reporting requirements,” the group said in a press release.

“While we each would have drafted this solution differently, we all agree it’s important to ensure that these obligations are properly crafted to apply only to entities that are regularly effectuating transactions of digital assets in exchange for consideration,” they added.

The White House had initially backed an amendment supported by Warner, Sinema and Portman that would have exempted more cryptocurrency actors from greater regulation than the bill’s original language but fewer than Wyden, Toomey and Lummis wanted.

Bitcoin was up 5.9% on the session at $46,217 on Monday afternoon.

Clarification: This story was updated with more details about how the amendment was blocked.

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