House leadership announced the Congressional Review Act joint resolution to roll back the IRS DeFi Broker Rule will be considered in the coming weeks; all eyes are on a Senate first move as early as this week. The House Financial Services Committee is soliciting stakeholder feedback on its stablecoin discussion draft. In committees this week, Senate Banking Subcommittee on Digital Assets will hold a hearing to explore bipartisan legislative frameworks for digital assets.

The SEC announced the creation of the Cyber and Emerging Technologies Unit to combat  misconduct in the emerging technologies space. The SEC Digital Assets Task Force is soliciting feedback on a wide range of issues related to digital asset securities.

Read more below

Congress

Hearings

• Last week
  • The House was in recess.
  • On February 20, the Senate Committee on Energy and Natural Resources held a hearing to Examine Research Security Risks Posed by Foreign Nationals from Countries of Risk Working at the Department of Energy’s National Laboratories and Necessary Mitigation Steps.
• This week
  • On February 25, the House Financial Services Committee will hold a hearing on Examining Policies to Counter China.
  • On February 26, the Senate Banking Subcommittee on Digital Assets will hold a hearing on Exploring Bipartisan Legislative Frameworks for Digital Assets.
  • On February 26, the House Financial Services Capital Markets Subcommittee will hold a hearing on the Future of American Capital: Strengthening Public and Private Markets by Increasing Investor Access and Facilitating Capital Formation.
  • On February 27, the Senate Banking Committee will hold a nominations hearing for CFPB, FHFA, and CEA.

Correspondence

• Sens. Cynthia Lummis (R-WY), Kirsten Gillibrand (D-NY), Steve Daines (R-MT), Ron Wyden (D-OR), Thom Tillis (R-NC), Bill Hagerty (R-TN), and Bernie Moreno (R-OH), sent a letter to the Securities and Exchange Commission (SEC) requesting clarification of the agency’s position regarding protocol staking in digital asset exchange traded products (ETPs). (Letter)(Press release)

• House Financial Services Chair French Hill (R-AR) and Subcommittee Chairs Dan Meuser (R-PA), Andy Barr (R-KY), and Bryan Steil (R-WI) sent a letter to Federal Deposit Insurance Corporation (FDIC) Acting Chair Travis Hill suggesting five recommendations that would help clarify regulations surrounding digital assets: written, public guidance; concrete rationale for account closures; eliminate “reputational risk”; balancing test for regulations; and uniform application. (Letter)(Press release)

• Sen. Cynthia Lummis (R-WY) sent letters to the Federal Reserve Board of Governors, Fed Inspector General, Federal Reserve Bank of Dallas, and Federal Reserve Bank of Richmond requesting documents regarding debanking and digital assets. (Letter)(Press release)

Publications

• House Majority Leader Steve Scalise (R-LA) released a list of rules House Republicans are prioritizing as potential targets for Congressional Review Act legislation, including “Digital Asset Sales (IRS): This rule requires brokers to report gross proceeds from crypto sales and other digital asset transactions, including data about the taxpayers involved. The rule increases tax filing burdens, stifles innovation, and raises privacy concerns over the sharing of taxpayers’ personal information.” (Press release)

Announcements

• The House Financial Services Committee is soliciting stakeholder feedback on its stablecoin discussion draft. Comments can be sent to the address included in the release. (Press release)

• Rep. Mike Flood (R-NE) announced he will host his next Flyover Fintech conference on September 23, 2025, at Nebraska Innovation Campus in Lincoln. The conference considers policy issues on emerging technologies including AI, cybersecurity, and digital assets. (Registration)(Press release)

• At an Opportunity Summit panel celebrating Black History Month, Senate Banking Committee Chair Tim Scott (R-SC) announced a goal of investing $1 trillion into disadvantaged communities, including “Leveraging Digital Assets: Senator Scott will prioritize establishing a clear, tailored regulatory framework for digital assets through legislation on stablecoins and crypto market structure, aiming to empower families, small businesses, and underserved communities to build wealth and participate more fully in the digital economy.” (Press release)

Trump Administration

Securities and Exchange Commission (SEC)

• The SEC announced the creation of the Cyber and Emerging Technologies Unit (CETU) to focus on combatting cyber-related misconduct and to protect retail investors from bad actors in the emerging technologies space. Priority areas include: fraud committed using emerging technologies, such as artificial intelligence and machine learning; use of social media, the dark web, or false websites to perpetrate fraud; hacking to obtain material nonpublic information; takeovers of retail brokerage accounts; fraud involving blockchain technology and crypto assets; regulated entities’ compliance with cybersecurity rules and regulations; and public issuer fraudulent disclosure relating to cybersecurity. (Press release)

Noteworthy Quotes and Events

ADMINISTRATION

Securities and Exchange Commission (SEC)

• Commissioner Hester Peirce released a statement entitled “There Must Be Some Way Out of Here” in which she solicits stakeholder feedback on a potential crypto asset taxonomy and on federal laws, or state corporate or commercial laws, that present challenges to innovation by SEC registrants. She highlights specific questions to help guide Task Force work on the definition of security, categories of crypto assets, registration process improvements, safe harbor, secondary market trading, custody, crypto lending, exchange-traded products, tokenized securities, sandbox considerations, and international issues. (Statement)

Federal Reserve

• In remarks before Georgetown University Law Center on Risks and Challenges for Bank Regulation and Supervision, Fed Vice Chair for Supervision Michael Barr spoke about “encouraging responsible innovation,” saying, “Another set of risks involve those related to the role of innovative technology in the financial sector. Innovation, when done responsibly, brings tremendous benefits to consumers, financial institutions, and the economy at large. For instance, blockchain technology underlying crypto-assets has the potential to make financial services better, cheaper, and faster. Responsible use of this technology could make banking more efficient and accessible to more consumers. With any new technology, there are new risks. To achieve the benefits in a durable manner over time, we must ensure that the associated risks are managed appropriately. With crypto-assets, investors do not currently have the structural protections they have relied on for many decades in other financial markets. It is important that those guardrails are put in place to avoid issues such as the misuse of client funds, misrepresentations, obfuscation about availability of deposit insurance, and fraud. We should also recognize that some of the attractive attributes of crypto-assets—the pseudonymous actors that are parties to transactions, the ease and speed of transfer, and the general irrevocability of transactions—also make crypto-assets attractive for use in money laundering and terrorist financing. It is encouraging to see innovators develop tools and processes to better manage these risks, while harnessing the benefits of the technology. But regulation and supervision also have an essential role to play.” (Remarks)

• Fed Governor Christopher Waller delivered remarks on Reflections on a Maturing Stablecoin Market at A Very Stable Conference in San Francisco, CA, in which he said, “…my hope is that the stablecoin market will grow or diminish on the merits of their benefits to consumers and the broader economy. For the private sector, that means continuing to develop innovative solutions that fit a market need while building sustainable business models. And for the public sector, it means setting clear and targeted legal and regulatory frameworks and coordinating those frameworks across states and national boundaries to enable private sector innovation at a global scale.” (Remarks)

CONGRESS

• Sen. Ted Cruz (R-TX) tweeted a Cointelegraph article saying, “Crypto firms rally behind Ted Cruz to block DeFi broker rule”

• Cruz also tweeted, “The crypto industry is backing my efforts to undo the Biden IRS rule that labels decentralized finance participants as ‘brokers.’ Crytpo is meant to be free from government control—the IRS doesn’t have the right to intrude on your personal privacy.”

• Sen. Cynthia Lummis (R-WY) tweeted, “Digital assets are the future. The U.S. can either pave the way or fall behind. I lead my colleagues to seek clarification from the SEC on digital asset ETP staking restrictions to make U.S. asset managers competitive in the global market.”

• Rep. Bill Huizenga (R-MI) tweeted, “Congrats Coinbase and friends! Glad to see SEC has finally come to its senses. Maybe it has to do with Gary Gensler not being there anymore??? I’m thankful for the new attitude shift towards innovation from President Trump and his Administration!”

• Huizenga also tweeted, “Digital assets have the potential to revolutionize payment systems in the United States, allowing financial systems to become more efficient and more accessible to consumers. Congress and SEC must work together to provide clear rules of the road for all digital asset market participants while offering consumer protections. Enforcement is not the answer.”

• Rep. Stephen Lynch (D-MA) tweeted, “The Digital Assets Subcommittee recently held its first hearing. As lead Democrat, I express strong concerns about the volatility and abuse of crypto assets. Americans lost more than $5.6 billion to crypto scams in 2023. Regulations are needed to ensure robust consumer protections and a stable economy.”

• Lynch also tweeted, “As ranking member of the Digital Assets Subcommittee, I spoke to Chairman of the Federal Reserve, Jerome Powell regarding my concerns of the risks posed by crypto and the crypto industry on our economic stability, with scams and illicit finance costing Americans billions. The Trump Administration’s executive order to establish a Digital Assets Working Group which will be comprised of regulators handpicked by the crypto industry is concerning—and could be abused to further President Trump’s own financial interests. I will continue to work with my colleagues to prioritize consumer protections, support a new regulatory framework, and expand economic access and financial inclusion for all Americans.”

• House Financial Services GOP tweeted, “NEW: The SEC made the right decision by withdrawing its appeal of the harmful dealer rule. The Committee looks forward to changing the tide on digital assets with the new leadership at the agency.”

• Rep. Andy Ogles (R-TN) tweeted, “I introduced the No CBDC Act because a central bank digital currency is nothing more than a tool for tyrants to intimidate, control, and surveil the activities of American citizens. It is my duty as a patriot to stop them.”

• Rep. Warren Davidson (R-OH) tweeted, “What will happen with markets? The last time the planet had this much debt was the end of World Word Two when the global monetary system was reset at Bretton Woods. All major central banks have spent years developing Central Bank Digital Currency and they all know their citizens oppose it. Nevertheless, they offer CBDC as a solution to a problem they have the ability to trigger. The biggest banks are generally the biggest globalists. The biggest banks are almost 100% aligned with the central banks. Collectively, they can trigger a crisis at will. Rationally, they should oppose such a crisis, but if there is one we already know they will blame President Trump. On the back end, gold markets are likely counters to defend the US dollar and our own markets. Proceed with caution. Have a plan.”

Highlights of the Week

• The Digital Energy Council is hosting a webinar featuring Rep. Jay Obernolte (R-CA), Chair of the House Bipartisan AI Task Force.

What I’m Reading This Week

• Illicit Finance: Agencies Could Better Assess Progress in Countering Criminal Activity, Government Accountability Office (GAO)

• That Colossal Wreck, Austin Campbell

About Zero One Strategies

Zero One Strategies is a boutique government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

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