Lowenstein Crypto advises leading digital asset and cryptocurrency projects, exchanges, and trading firms. Our practice covers regulatory advice, transactions and structuring advice, investigations, and adversarial matters including commercial disputes, bankruptcy, and related litigation. As these markets continue their rapid growth and market participants continue to evolve and mature their businesses, we are providing this weekly digest as a resource that highlights and summarizes a selection of key recent legal regulatory developments.

Senate Banking and Senate Agriculture To Hold Markup Hearings on Jan. 15

The Senate Committee on Banking, Housing, and Urban Affairs and the Senate Committee on Agriculture, Nutrition, and Forestry intend to hold markup hearings regarding market structure legislation on Jan. 15. The topics anticipated to be covered during these hearings surround market structure legislation, specifically in connection with stablecoin oversight, the Commodity and Exchange Commission’s regulatory role, and decentralized finance.

American Bankers Association’s Community Banks Council Sends Letter to the U.S. Senate Identifying Alleged Gaps Under the GENIUS Act

On Jan. 6, the American Bankers Association’s Community Banks Council (ABA), sent a letter to the U.S. Senate requesting U.S. lawmakers to clearly establish boundaries in connection with yield-generating stablecoins under the GENIUS Act, which was passed in 2025. The ABA's chief concern is that while the GENIUS Act prohibits interest payments, it may allow stablecoin issuers, who are not subject to the same robust banking regulations as traditional banks, to provide similar yield products through arrangements with digital asset exchanges and other partners (e.g., staking rewards). The ABA argues this could incentivize customers to move funds from regulated bank deposits to stablecoins. It is anticipated that yield-bearing stablecoins will be a topic of discussion in the upcoming hearings of the Senate Agriculture Committee and the Senate Banking Committee. See the ABA’s letter here.

Democrats Introduce Bill Banning Elected Officials From Prediction Markets

On Jan. 5, Rep. Ritchie Torres (D-N.Y.) introduced the Public Integrity in Financial Prediction Markets Act of 2026, which, if enacted, would ban federally elected officials from making insider trades on prediction market sites. Specifically, the bill restricts elected officials from making prediction market transactions related to (a) government policies, (b) government actions, and (c) political outcomes, if they possess, or may reasonably obtain, material nonpublic information relevant to the transaction. The full bill is available here.

California Unclaimed Property Law Now Applies to Digital Financial Assets

On Jan. 1, California Senate Bill 822 (SB 822), signed into law on Oct. 11, 2025, became effective. SB 822 amends California’s Unclaimed Property Law (UPL) to clarify that digital financial assets held on centralized exchanges constitute intangible property and are therefore subject to the UPL. Under SB 822, the three-year dormancy period is triggered when written or electronic communications to the owner are returned as undeliverable or when the owner has not exercised ownership over the account and the holder is unable to track undelivered communications. The three-year dormancy period is tolled or interrupted if the owner performs an act of ownership. Acts of ownership include conducting transactions, electronically accessing the account, engaging in activity in another account or property with the same holder, or taking any action that reasonably demonstrates the owner’s awareness of the property’s existence. For more information, see the full bill here.

CFTC Appoints Amir Zaidi as Chief of Staff

On Dec. 31, 2025, Commodity Futures Trading Commission (CFTC) Chairman Michael S. Selig announced that Amir Zaidi will serve as the CFTC’s Chief of Staff. Zaidi previously spent nearly a decade at the CFTC from 2010 to 2019 and played a key role in overseeing the launch of the first CFTC-regulated bitcoin futures contract. According to the CFTC’s press release, Zaidi’s return comes at a time when the agency is developing regulatory frameworks and advancing policy initiatives to redefine the institutional crypto-derivatives market and integrate digital assets into the mainstream financial system. See the official press release here.

World Liberty Financial Announces Submission for a National Trust Bank Charter

On Jan. 7, World Liberty Financial, the decentralized finance (DeFi) protocol supported, in part, by President Donald Trump, announced that WLTC Holdings LLC filed an application to the Office of the Comptroller of the Currency (OCC) for a national trust bank charter in connection with its proposed stablecoin operations. With its charter, WLTC intends to support institutional customers such as digital asset exchanges, market makers, and investment firms. Under OCC’s supervision, WLTC intends to support minting and redemptions in connection with the USD1 stablecoin, provide conversion services for USD1 and U.S. dollars, and custody USD1 and other stablecoins. See the company’s press release here.

SEC Files Complaint Against Purported Crypto Asset Trading Platforms and Investing Clubs

On Dec. 22, 2025, the Securities and Exchange Commission (SEC) filed a complaint in the U.S. District Court for the District of Colorado against purported crypto asset trading platforms Morocoin Tech Corp., Berge Blockchain Technology Co. Ltd., and Cirkor Inc. and investment clubs AI Wealth Inc., Lane Wealth Inc., AI Investment Education Foundation Ltd., and Zenith Asset Tech Foundation alleging the parties targeted retail investors and defrauded them out of more than $14 million. The schemes involved attracting victims with ads on social media, building the victims’ trust in group chats where fraudsters posed as financial professionals and promised profits from AI-generated investment tips, and then convincing the victims to put their money into fake crypto asset trading platforms where it was misappropriated. See the SEC’s press release here and a copy of the complaint here.