Treasury Secretary Scott Bessent criticized cryptocurrency businesses that oppose the Clarity Act, calling for compliance or leaving the U.S., amid predictions of a 32% drop in Bitcoin prices in 2026.
Treasury Secretary Scott Bessent delivered the harshest remarks from a member of the Trump administration regarding the cryptocurrency industry since taking office. During a hearing before the Senate Banking Committee on Thursday, he criticized what he called “the industry nihilists,” those who oppose Congress’s efforts to regulate cryptocurrencies instead of embracing proper oversight mechanisms.
Bessent stated that companies unwilling to see the Clarity Act passed could “move to El Salvador,” the country that recognized Bitcoin as legal tender in 2021. The mention of El Salvador was seen as a sarcastic jab at cryptocurrency leaders seeking to operate without the regulatory constraints the bill would impose.
He stressed that it's unacceptable for people to want to live in America but not want regulations for this vital industry, and that the government must introduce safe, sound, and smart practices.
Coinbase breaks legislative consensus.
Secretary Bessent's remarks came after Coinbase withdrew its support for the Digital Asset Market Clarification Act in January 2026, derailing a planned vote in the Senate Banking Committee. CEO Brian Armstrong broke the fragile legislative consensus just hours before a scheduled amendment debate, declaring the company "would rather have no bill than a bad one."
The main reason Coinbase withdrew its support was the terms that virtually prohibited cryptocurrency exchanges from offering yields or rewards for holding stablecoins like USDT or USDC. The risk to Coinbase is significant, as the exchange reported $355 million in stablecoin-related revenue in Q3 2025, with analysts forecasting total annual revenue could exceed $1 billion.
The dispute over stablecoin yields pits crypto asset companies against traditional banks, which have lobbied for stricter regulations, arguing that this is necessary to prevent money from flowing out of savings accounts. Senate drafts would prohibit crypto asset providers from paying passive yields simply for holding stablecoins, while allowing activity-based rewards tied to trading or liquidation provision.
The hearing took place as lawmakers sought to restore momentum to the Clarity Act, which aimed to resolve the jurisdictional dispute between the SEC and CFTC and establish clear frameworks for digital goods, investment contracts, and stablecoins. The bill was once XEM as the cryptocurrency industry's biggest chance for a comprehensive federal regulatory framework after years of enforcement and legal uncertainty.
Senator Mark Warner, a Democrat who supports crypto assets, expressed frustration with the protracted process, saying he felt like he was in “crypto asset hell,” prompting laughter in the hearing room. Senator Angela Alsobrooks insisted the Senate wanted to reach a good, bipartisan bill that would both protect innovation and protect community banks.
The hearing took place as Bitcoin fell more than 32% in 2026, trading around $63,100 after having touched above $97,000 in January. The decline accelerated by more than 12% that day after Mr. Bessent ruled out the possibility of government bailout for the cryptocurrency during his testimony before the House Financial Services Committee.
