‘Truly infuriating’: SEC technical briefing on crypto bill sparks blowback from House Democratic staff

Democratic staffers say they felt like the U.S. Securities and Exchange Commission was “trying to hide the ball,” when agency staff was asked technical questions about a cryptocurrency market structure bill, calling that phone call the “worst technical assistance briefing” they had witnessed.

Democratic staffers spoke freely on Tuesday during a press briefing about the meeting that took place last week about significant qualms, a day before the House Financial Services Committee is set to hold a hearing to discuss the bill known as The CLARITY Act. They said Republicans were provided with written technical assistance, which is routinely done between staffers and agencies when contemplating legislation, but they weren’t.

SEC staff who are subject matter experts are supposed to be involved in the technical assistance briefings, but staffers said someone from the agency’s newly created Crypto Task Force, legislative affairs folks, and someone from the office of general counsel were on the call. That is a “stark departure” from how those calls were done in the past, they said. Staffers said people on the call representing the SEC were not able to answer simple questions and alluded to some information being privileged.

When asked by another reporter whether the SEC was deliberately obstructing the staffers or if they chalked it up to incompetence, one staffer said it was hard to know.

“Some of it did feel like they just didn’t understand some of the basic questions,” they said. “But then also, when they kept bringing up, you know that things were privileged that they’d shared with Republicans on our committee, which clearly are not privileged, that made it feel like they were trying to hide the ball.”

The SEC did not immediately respond to a request for comment.

The CLARITY Act

The House Financial Services Committee, which is a pivotal congressional panel for advancing crypto bills, plans to hold a hearing this week to discuss a bill called the Digital Asset Market Clarity Act, known as CLARITY. Chair of that committee, Republican French Hill, introduced the 236-page bill last week, which looks to create a clear regulatory framework for crypto in part through designating how the SEC and the Commodity Futures Trading Commission will regulate. The bill also requires digital asset firms to provide disclosures to customers and segregate customer funds from their own.

A few Democrats cosponsored the bill, including Reps. Angie Craig, Ritchie Torres, and Don Davis. A hearing to discuss the bill is scheduled for Wednesday morning. The House Agriculture Committee is also holding a hearing on the bill on Wednesday.

Meanwhile, top Democrat of the House Financial Services Committee Maxine Waters sent a letter to SEC Chair Paul Atkins asking him to respond to questions by June 6.

“I believe that the current Commission’s expert analysis of the CLARITY Act and fulsome answers to the questions raised above are necessary for the American people, through their representatives in Congress, to determine whether this legislative proposal addresses the unique risks related to crypto, and would foster the needed environment for responsible innovation to take root,” Waters said.

Calls with the SEC and other agencies are common in both Republican and Democratic administrations, one Democratic staffer said. Those technical meetings are needed to help figure out what a bill does and can be anywhere from 30 minutes to three hours. The meeting held last week lasted one hour, according to staffers.

“I’ve been doing these the whole time I’ve been on the Hill, which is a long time, and this was the worst call I’ve ever been on,” a staffer said. “It was horrible. They did not have experts that understood the legislation on the phone.”

The staffer also said that people representing the SEC on the call did not read questions sent ahead of time, calling it “truly infuriating.”

Cracks are showing 

The market structure legislation expands on work done in that committee over the years with the Financial Innovation and Technology for the 21st Century Act (FIT 21). That bill passed out of the House last year with 71 Democrats in support, but ultimately didn’t move forward. Waters had said FIT21 was one of the worst bills she’s ever seen.

Lawmakers, led by Republicans, have been pushing full steam ahead on bills to regulate crypto. The Senate voted to move forward with a bill to create a federal regulatory framework for stablecoins, and it could be voted on again this week. Pressure to advance both bills is coming from the top. President Donald Trump has said he wants that bill on his desk by August, and last week, Vice President J.D. Vance urged action, warning that inaction could send trillions of dollars offshore.

The House Financial Services Committee has begun showing cracks in how it plans to approach crypto legislation. Last month, some Democrats, including Waters, boycotted a hearing and splintered off to lead a roundtable on “Trump’s crypto corruption and conflicts of interest.”

Trump and his family have embraced digital assets, launching their own memecoins shortly before his 2025 inauguration. His affiliated venture, World Liberty Financial, recently launched its own stablecoin.

Trump’s crypto involvement will still be a “pretty tough hill to climb,” a staffer said on Tuesday.

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