🚨NEW: Interesting tidbit from Senator @MarkWarner (D-VA) just now that suggests there may have been some movement in Democrat/GOP negotiations over the remaining DeFi/BRCA sticking points. Warner said further bipartisan negotiations took place this morning and that Republicans *accepted* some proposed changes. Could signal that at least some Democrats may now be open to voting in favor of the bill after all. We will see. 👀

🚨GM! Big day for crypto on Capitol Hill. You can watch the markup live on @BankingGOP X account starting at 10:30 AM EST. A small update since last night: The 5 pro-crypto Banking Committee Dems gathered this morning to figure out final direction on how to vote in today’s markup after negotiations with GOP colleagues fell through last night, according to three sources. However, hearing it’s likely going to be a collective vote against, driven largely by disagreements over the BRCA after @CortezMasto pushed for changes following support from law enforcement groups this week for her amendments. After everything we heard about ethics this week, it no longer appears to be the central sticking point. Instead, the focus seems to have shifted to whether Democrats believe the Grassley-Lummis backed BRCA compromise goes far enough to address law enforcement concerns. As always, nothing is final until it happens, so we’ll see what the next few hours bring.

🚨 WATCH: Chairman @SenatorTimScott leads the Senate Banking Committee in a historic markup of the CLARITY Act, legislation to establish clear rules of the road for digital assets.

🚨NEW: Negotiations between a small group of bipartisan senators aimed at getting Democrats to a better place on at least two outstanding Clarity Act issues wrapped for the night without a deal, I’m told. In a statement, one of the lead GOP negotiators, @SenLummis, said: “Ultimately, we have agreement on 99% of the bill. I hope my colleagues across the aisle will work with me to get the remaining 1% resolved after we pass this bill out of committee. Otherwise, when or if another FTX happens, we will have no one to blame but ourselves.” Democrats like @SenAdamSchiff and @SenRubenGallego had been pushing to reach a compromise on ethics/conflicts of interest involving the First Family ahead of tomorrow’s markup as a condition of their support for the bill, while other Democrats voiced eleventh-hour concerns about provisions tied to the Blockchain Regulatory Certainty Act (BRCA), which would prevent non-custodial software developers from being prosecuted under money transmitter laws. It’s my understanding that meaningful progress was made on ethics, but last minute disagreements over BRCA changes ultimately prevented a deal from coming together. Of course, it’s still unclear how the five pro-crypto Democrats on the Banking Committee will ultimately vote tomorrow, but as of now, the expectation is that the markup will be partisan.

News: Sens. Reed (D-R.I.) and Smith (D-Minn.) have filed an amendment ahead of Thursdays markup that will force senators to choose between crypto and the banks The amendment would incorporate bank’s changes to stablecoin yield restrictions. Tough tough vote for bank-friendly Rs