House Financial Services Committee leaders Patrick McHenry and Maxine Waters have been collaborating on a regulatory framework for stablecoins since 2022, yet their proposed bill has struggled to gain traction.

Despite the challenges, stablecoin legislation is viewed as having the highest likelihood of passing, albeit only under ideal circumstances.

Waters has emphasized the importance of reaching a 'grand bargain' on stablecoin legislation before the year's end, suggesting a potential breakthrough in negotiations.

However, U.S. lawmakers are currently on recess until after the election, which limits the time available for passing bills during the upcoming lame-duck session.

During this period, lawmakers will need to prioritize critical issues such as government funding and the National Defense Authorization Act (NDAA), further constraining legislative opportunities.

Investment bank TD Cowen predicts a slowdown in cryptocurrency legislation advancement, with no significant progress expected before the end of 2024.

Jaret Seiberg of TD Cowen expressed skepticism about major legislative action occurring during the current lame-duck session.

Seiberg also suggested that if the crypto industry successfully ousts Sen. Sherrod Brown, Democrats might retaliate by withholding support for crypto legislation.

The Ohio Senate race has seen substantial spending aimed at ousting Brown, who has been a vocal critic of the cryptocurrency sector.

Recent polls indicate that Brown is narrowly leading his crypto-friendly opponent, Bernie Moreno.

In the broader political landscape, presidential candidates Donald Trump and Kamala Harris are actively courting cryptocurrency supporters, signaling a more favorable stance toward the industry.

Earlier this year, the FIT21 legislation achieved bipartisan support in the House but has since stalled in the Senate.