TD Cowen Says US Crypto Reforms Could Slip to 2027 and Beyond

TLDR

• Ethics-rule standoff in Congress delays core US crypto framework beyond 2027.
• TD Cowen forecasts reform momentum slowing, with rollout drifting to 2029.
• Parties dig in over conflict rules tied to officials, widening the timetable.
• Possible compromise centers on a three-year delay to ease political tensions.
• CLARITY Act work moves ahead, but national market rules stay on a slow track.

The outlook for US crypto reforms shifted again as TD Cowen projected a multi-year delay, and the firm linked the slowdown to political tension. The report indicated that disagreements on ethics rules now shape the timeline, and the analysis suggested that any final framework may not arrive before 2027. The note also stated that full implementation could extend into 2029, and the delay keeps the sector waiting for clear national rules.

Conflict Provisions Stall Progress

TD Cowen reported that conflict-of-interest language has become the central barrier, and the issue now determines legislative momentum. Democratic lawmakers pushed new restrictions on senior officials, and these restrictions referenced concerns involving the current administration. Republican leaders rejected the approach, and the disagreement created an impasse that slowed crypto reforms across both chambers.

The firm observed that the two parties remain firm, yet both sides consider the broader stakes. Democrats argue that ethics standards strengthen credibility, while Republicans challenge provisions that would directly affect current officeholders. Therefore, the report stated that the political gap remains wide and continues to weigh on the timing of crypto reforms.

TD Cowen outlined a possible compromise and noted that a delay in enforcement may offer a path forward. The analysis pointed to a three-year postponement, and such a delay could push conflict rules beyond the current term. As a result, lawmakers could advance crypto reforms while deferring the most disputed elements.

Timeline Pressures Shape Legislative Strategy

The report stated that Democrats see limited advantage in swift action before the 2026 midterms. The firm noted that a potential House shift gives the party strategic options, and the calculation could influence how they negotiate crypto reforms. A later vote may allow them to revisit ethics measures under a different political balance.

TD Cowen added that the Senate remains the hardest chamber to navigate. The legislation must clear a 60-vote threshold, and the forecast suggested that several cross-party votes will be required. Therefore, the firm said the Senate dynamic strengthens Democratic leverage and may extend the timeline for crypto reforms.

The analysis also referenced leadership efforts to refine the bill’s language. Staff teams continue technical work, and both committees plan further discussions through next year. Even so, the firm stated that major movement appears unlikely until after the midterm cycle, keeping crypto reforms on a slower track.

CLARITY Act Still Advancing

Although the broader package faces delays, TD Cowen said Congress will continue shaping the CLARITY Act. The Act remains a cornerstone of the market structure debate, and work on definitions and oversight provisions will continue through early 2026. Crypto reforms will still progress in parts even as full legislation slows.

The firm highlighted that the industry wants uniform rules sooner rather than later. However, the projected schedule means final authority on classifications, oversight duties, and compliance standards may fall to a future administration. This shift underscores why crypto reforms now stretch into a longer horizon.

TD Cowen concluded that regulatory momentum remains real, but not immediate. The firm said the sector should prepare for extended negotiations, and implementation will likely mirror the long runway seen in other financial laws. This suggests that the most significant crypto reforms remain several years from completion.

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