Bitwise CIO Warns Congress May ‘Fumble’ Crypto Regulation at Final Stretch

Bitwise Chief Investment Officer Matt Hougan has voiced serious concerns over Congress’s ability to pass meaningful crypto regulation, warning that the industry could face a rough summer if lawmakers drop the ball on pending legislation.

In a note to clients on Monday, Hougan expressed optimism about crypto’s broader outlook—predicting all-time highs for many digital assets and a potential $200,000 price for Bitcoin under the current administration.

However, he cautioned that such progress remains fragile unless Congress codifies regulatory clarity into law.

Hougan Warns Trump’s Crypto Wins Could Be Reversed Without Congressional Action

Despite supportive moves from the Trump administration—including a Bitcoin Strategic Reserve, reversed SEC enforcement actions, and regulatory rollbacks—Hougan warned that these executive measures could be undone by future leaders.

“We need Congress to pass legislation enshrining crypto’s progress in law,” he said.

The Bitwise CIO had been hopeful that stablecoin legislation would sail through this year, particularly after the GENIUS Act cleared the Senate Banking Committee in March with bipartisan support.

The bill mandates 100% reserve backing for stablecoins, regular audits, and strict marketing and insolvency rules.

But momentum stalled last weekend when nine Senate Democrats, including Senate Minority Leader Chuck Schumer, abruptly withdrew support.

They cited concerns over anti-money laundering and national security provisions—despite the updated bill being stronger in those areas than its earlier version.

From me: Crypto-friendly Dems abandoned a stablecoin bill they voted for in committee,after Trump crypto corruption grew too big to ignore.
Even Sen.Alsobrooks, cosponsor of the bill & the only Banking Cmte member who didn't back away from it, told me she supports her colleagues: pic.twitter.com/dFwylebTpR

— David Dayen (@ddayen) May 5, 2025

Hougan suggested that shifting political winds, including Trump’s declining approval ratings and growing scrutiny over his crypto business ties, are playing a bigger role than policy disagreements.

He also criticized efforts within the crypto industry to bundle the GENIUS Act with broader market structure reforms, warning that doing so risks derailing both.

Democrats Plan to Boycott a Hearing on Crypto Market

Meanwhile, the House is facing its own turmoil.

Democrats are reportedly planning to boycott a joint hearing on crypto market structure, while another bill—the STABLE Act—continues to make headway.

Adding to the complexity, World Liberty Financial, a DeFi platform backed by Trump, recently launched its stablecoin.

Despite the political setbacks, Hougan remains cautiously hopeful.

“Stablecoins are too obviously beneficial—for America, the dollar, merchants, and entrepreneurs—for petty political jockeying to derail progress,” he wrote.

“If Washington can get its act together, I think the bull market will be unstoppable. If not, we’re in for a very difficult summer.”

In another development, Florida has become the latest US state to abandon efforts to establish a strategic Bitcoin reserve, dealing another setback to the broader push for state-level crypto adoption.

Two proposed bills — House Bill 487 and Senate Bill 550 — were officially withdrawn from the legislative process on May 3.

The legislative session had adjourned a day earlier, on May 2, without taking action on the crypto-focused proposals.

Their removal places Florida alongside a growing list of states — including Wyoming, South Dakota, North Dakota, Pennsylvania, Montana, and Oklahoma — that have recently failed to pass legislation allowing Bitcoin-based investment strategies.