Former Defense Secretary Mark Esper is casting the stalled Digital Asset Market Clarity Act as a national-security measure. In a weekend op-ed, he argued that thin crypto regulation hands openings to North Korea and China. Meanwhile the Senate left town for its August recess without holding even a procedural vote, pushing the market-structure fight into September.
Esper, a member of the Coinbase Global Advisory Council, wrote in the Financial Times on Saturday that the bill “is not merely a financial services bill” but “also a national security bill, and it should be understood as such and passed with urgency.” The effect is to reframe a regulatory turf fight as a geopolitical one.
Beijing is already pouring resources into state-directed payment systems designed to sidestep American oversight and erode the dollar’s central role, Esper wrote. The act would extend Treasury’s special-measures authority under Section 311 of the USA PATRIOT Act, what Esper called “one of our sharpest weapons against rogue actors,” to close crypto-specific loopholes exploited by North Korean groups such as Lazarus. “I have long argued that China is the greatest strategic threat of our lifetime,” he wrote.
The op-ed landed one day after negotiations broke down. Senate Majority Leader John Thune filed cloture on Saturday to bring the bill to the floor, Cointelegraph reported, with a vote expected on Sept. 15. CoinDesk’s live updates set the next action at Sept. 14. The dates differ. Both place the vote in mid-September.
The Senate would not hold so much as a procedural vote before leaving for recess on Friday. The biggest obstacle was ethics. President Donald Trump’s crypto business ties have alarmed Democrats for over a year, and the problem deepened with a report that Trump disclosed $1.4 billion in crypto-related profit. A source familiar with the talks described that figure to CoinDesk as the “kill shot” for Friday’s negotiations.
Other outstanding issues remain. Law enforcement provisions, agriculture-related concerns, and growing worries about stablecoin yield and rewards are all unresolved. Republicans are now raising concerns too, a staffer told CoinDesk, so the blame cannot be laid at either party.
The August deadline was more of what the crypto industry hoped for than a hard-and-fast rule, according to two people who spoke to CoinDesk. A failed cloture vote would not necessarily end the process. The GENIUS Act fell short before it eventually passed the Senate. But it would narrow the window. Senator Thom Tillis told Politico the odds “drop precipitously” once the election and the lengthy break eat into the calendar. A bill not voted out by September faces long odds of reaching the president’s desk this Congress.
CoinDesk’s State of Crypto column argues the delay could be a blessing in disguise. More time to resolve the ethics language. Fewer days for a premature floor defeat to kill the bill outright. If the bill had failed a cloture vote, it may well have ended the process until the next Congress, the column noted.
The two senators leading the bill remain publicly committed. Senator Angela Alsobrooks said in a statement shared with CoinDesk: “We’ve worked for over a year on a bipartisan basis to protect consumers, limit deposit flight, fight illicit finance and include a fair deal on ethics. We will continue our work — getting Clarity Act right remains our goal.” Senator Cynthia Lummis posted online that “we’ve come too far to quit now,” adding that the industry deserves “clear rules of the road on U.S. soil” and that law enforcement deserves the tools to hold bad actors accountable.
The market barely registered the delay. Bitcoin held near $65,200 on Monday, up 3.7% on the week, per CoinDesk data, recovering from an early-August low near $62,000. Ether traded near $1,925. Strategists argued the delay was already priced. The failure landed as confirmation rather than a fresh blow. Spot ETFs have strung together consecutive days of inflows against a softer dollar following a weak U.S. jobs report.
Esper’s security framing is the industry’s sharpest remaining argument for urgency. Whether it moves any votes in September is not yet known.
