**US Government Shutdown Enters 38th Day: Crypto Legislation Stalled Amid Funding Crisis**
The US government shutdown reached its 38th day on Friday as senators prepared to vote on legislation that could temporarily reopen federal operations. The Senate is set to consider a continuing resolution from the House of Representatives to fund the government, but the bill faces an uncertain path forward. It requires 60 votes to pass in the Senate, following multiple failed attempts in recent weeks.
**Crypto Legislation Takes a Backseat**
Amid the ongoing funding crisis, discussions around digital asset market structure legislation—known as the CLARITY Act in the House and the Responsible Financial Innovation Act in the Senate—have continued, but all non-essential bills have taken a backseat. This legislation aims to establish a clear regulatory framework for cryptocurrencies in the United States. However, progress has slowed as Congress focuses on resolving the shutdown.
Members of Congress continue to receive their paychecks during this period, while many federal agency staff members have been furloughed or are working without pay. The prolonged shutdown has placed significant strain on government operations and the advancement of key regulatory measures.
**Partisan Gridlock Over Funding Negotiations**
Democrats have remained firm in their demands for healthcare subsidy extensions and the reversal of cuts enacted in a July funding bill. On Friday afternoon, Senate Minority Leader Chuck Schumer proposed a new Democratic plan that would reopen the government if a one-year extension of Obamacare subsidies were included. Republicans immediately rejected this proposal, while Democrats also dismissed GOP compromise efforts, leaving negotiations at an impasse.
**Crypto Bill Timeline in Jeopardy**
Wyoming Senator Cynthia Lummis previously outlined an ambitious timeline for advancing the crypto market structure bill: Republicans planned to move the legislation through the Senate Banking Committee by the end of September and the Senate Agriculture Committee in October, with hopes of having it signed into law by 2026. Although some committee discussions have taken place, this timeline now appears less attainable due to the ongoing shutdown and the fast-approaching legislative holidays.
Senate Majority Leader John Thune indicated on Friday that he hopes a new compromise bill could gain bipartisan support, possibly paving the way for a vote by the weekend. Such a bill might include a revised shutdown end date and provide full-year authorization for select federal programs.
**Mounting Economic Impacts**
The economic effects of the shutdown are spreading across multiple sectors. The Federal Aviation Administration (FAA) has already ordered a 4% cut to flight capacity, with plans to deepen reductions to 10% or more next week if the funding stalemate persists. Transportation Secretary Sean Duffy has warned that the situation could devolve into “mass chaos,” with air traffic capacity cuts potentially reaching 15% or even 20%. Airlines have already canceled hundreds of flights due to these restrictions.
In addition, a federal judge in Rhode Island ordered the Trump administration on Thursday to immediately cover full Supplemental Nutrition Assistance Program (SNAP) benefits for tens of millions of Americans, ensuring continued food assistance despite the government’s partial shutdown.
**Outlook**
With no breakthrough in sight, the government shutdown continues to disrupt critical services and delay important legislative action, including the advancement of much-anticipated crypto regulation. As the economic and operational toll mounts, pressure is growing on lawmakers to resolve the funding impasse and restore normal government function.
https://coincentral.com/government-shutdown-delays-senate-crypto-market-structure-bill-progress/
