Trump filling Democratic seats at SEC, CFTC could advance crypto bill talks, TD Cowen says

Filling Democratic vacancies at the Securities and Exchange Commission and the Commodity Futures Trading Commission could help move negotiations on a U.S. crypto market structure bill forward, according to TD Cowen.

The investment bank said the biggest obstacle to passing the legislation is not the bill’s core framework — which focuses on whether digital assets should be regulated as securities by the SEC or as commodities by the CFTC — but a political dispute over conflict-of-interest rules.

Democrats are pushing for a ban that would prevent senior government officials and their families from making certain financial transactions involving digital assets. TD Cowen said this proposal would include President Donald Trump and his family, given his involvement with the crypto project World Liberty Financial. Trump has raked in about $1.4 billion from his crypto ventures, including World Liberty Financial, Bloomberg estimated last month. The Trump family also holds a 20% stake in the mining firm American Bitcoin.

According to TD Cowen, Democrats are unlikely to abandon the demand because the party has made the President’s crypto holdings part of its messaging ahead of the midterm elections.

Last month, no Democrats voted in favor of a bill in the Senate Agriculture Committee, citing concerns about Trump’s crypto ventures. It remains unclear whether Democrats will support a bill in the Senate Banking Committee.

Republicans, meanwhile, oppose the proposal because they believe Trump would veto legislation requiring his family to divest its crypto holdings, TD Cowen said. It added that the disagreement has created a political deadlock even as industry groups continue to negotiate the broader structure of crypto regulation.