Senate Crypto Bill Markup Delayed After Coinbase Withdraws Support

VADODARA, January 14, 2026 — The Senate Banking Committee's markup for the Clarity Act, a cryptocurrency market structure bill scheduled for January 16, faces potential cancellation after Coinbase withdrew its support, according to a report by Eleanor Terrett on X. This latest crypto news injects regulatory uncertainty into markets already testing key liquidity zones, with Bitcoin trading at $97,413. Market structure suggests that without clear legislative frameworks, price action may remain range-bound as institutional capital awaits regulatory clarity.

Market Context & Background

The Clarity Act represents a critical attempt to establish federal oversight for digital asset markets, mirroring the Securities Act of 1933 in its ambition to define jurisdictional boundaries between the SEC and CFTC. Underlying this trend is a five-year pattern where regulatory gaps have fueled volatility, as seen during the 2021-2022 cycle when unclear guidance on staking and token classification led to enforcement actions. Consequently, the bill's delay perpetuates a market environment where legal risks outweigh fundamental analysis, creating Fair Value Gaps (FVGs) in asset pricing. Historical cycles suggest that prolonged regulatory ambiguity correlates with suppressed on-chain activity, as evidenced by declining UTXO age bands during previous policy standoffs.

What Happened?

According to Terrett's reporting, citing an anonymous source, Coinbase requested the Senate to postpone the markup before officially withdrawing support for the legislation. The host of "Crypto in America" noted she could not confirm if the Senate Banking Committee, chaired by Tim Scott, would proceed with the session. Industry sources confirmed Coinbase's actions, though no official statement from the exchange or committee has been released. This development follows months of drafting aimed at clarifying digital asset classifications, with the markup intended to refine language before floor debate. The withdrawal of a major industry participant like Coinbase—a publicly traded entity under SEC scrutiny—signals deep disagreements over provisions potentially affecting exchange operations and token listings.

Technical Analysis & Price Action

Bitcoin's price action at $97,413 reflects a neutral market sentiment, with the 24-hour gain of 2.40% testing a key Order Block near the $98,500 resistance level. On-chain data indicates thin liquidity above $99,000, creating a potential Gamma Squeeze scenario if bullish momentum accelerates. The Relative Strength Index (RSI) at 54 suggests balanced buying pressure, while the 50-day moving average at $94,800 provides dynamic support. Market structure suggests a Bullish Invalidation level at $95,200, corresponding to the January low and a 0.382 Fibonacci retracement from the December rally. A break below this level would invalidate the current consolidation pattern, targeting $92,000 as the next Volume Profile node. Conversely, sustained closes above $98,500 could trigger a liquidity grab toward $101,000, aligning with the 1.618 Fibonacci extension from the recent correction.

By The Numbers

Why It Matters

For institutional investors, delayed legislation extends the timeline for clear custody rules and token classification, potentially deferring large-scale capital allocations as seen in JPMorgan's 2026 inflow forecasts. Regulatory gaps force institutions to rely on state-level frameworks like New York's BitLicense, increasing compliance fragmentation. For retail traders, uncertainty amplifies volatility around news events, creating exploitable FVGs but also raising systemic risk from regulatory enforcement actions. The SEC's historical approach to regulation by enforcement—documented in official SEC filings—means that without federal clarity, market participants face unpredictable legal exposure. This dynamic suppresses innovation in areas like tokenized assets, as evidenced by Figure's OPEN Network launch testing liquidity amid these gaps.

Community Sentiment

Market analysts on X express cautious pessimism, with one noting, "Coinbase's withdrawal signals the bill may favor overly restrictive frameworks, echoing past drafts rejected by industry." This sentiment aligns with previous criticism from exchange leadership, who argued that unclear definitions could stifle Layer-1 development. Bulls highlight that delay allows for more nuanced provisions, potentially avoiding harsh constraints on proof-of-stake networks. However, bears counter that prolonged ambiguity benefits regulatory arbitrage, pushing activity to jurisdictions with clearer rules but increasing global market fragmentation.

Price Prediction / Future Outlook

Bullish Case: If the markup proceeds with revised language acceptable to industry players, regulatory clarity could trigger a breakout above $98,500, targeting $101,000 as institutional capital enters. On-chain data indicates accumulation by large holders (10k+ BTC) near current levels, suggesting confidence in long-term resolution. A successful bill passage would establish a predictable framework, boosting adoption and potentially driving Bitcoin toward $110,000 by Q2 2026 as regulatory risk premiums compress.

Bearish Case: Further delays or a contentious markup collapse could break the $95,200 support, activating a Bearish Invalidation level and targeting $92,000. Regulatory uncertainty would persist, suppressing trading volumes and increasing volatility as seen during previous policy impasses. In this scenario, Bitcoin may consolidate between $90,000 and $96,000 until clearer signals emerge, with altcoins underperforming due to heightened classification risks. A breakdown below $90,000 would indicate a broader market reassessment of regulatory timelines.