Crypto today: GOP market bill; Strategy BTC holdings; China ban

Developments in the digital asset sector today included Republican lawmakers pushing for action on a market-structure bill amid claims of debanking, Strategy establishing a $1.44 billion US dollar reserve while expanding its Bitcoin holdings to 650,000 BTC, and China reiterating its ban on cryptocurrencies with a focus on stablecoins.

Republicans press for digital asset market-structure legislation following debanking allegations

Republican members of the US House Financial Services Committee and the House Oversight Subcommittee issued a final report on what they termed “debanking of digital assets,” alleging that regulators under the administration of former US President Joe Biden limited access to banking services for certain crypto firms and individuals.

In a notice on Monday, House Financial Services Chair French Hill and Oversight Subcommittee Chair Dan Meuser said regulators “used vague rules, excessive discretion, informal guidance, and aggressive enforcement actions to pressure banks away from serving digital asset clients,” an approach some Republicans have labeled “Operation Choke Point 2.0.”

The report called for legislative action to establish clearer rules for the cryptocurrency industry, stating that “Congress must enact digital asset market structure legislation,” including the CLARITY Act and other measures addressing digital assets. It added that the CLARITY Act aims to prevent a future “Operation Choke Point 3.0” by curbing regulation by enforcement, providing defined guidelines for market participants in the US, and affirming that banks can participate in the digital asset ecosystem.

The Digital Asset Market Structure bill, passed by the House of Representatives in July, is currently under review by the Senate Agriculture Committee and the Senate Banking Committee, both of which have circulated draft legislation. Senate Banking Chair Tim Scott said in November the committee expects to have a bill prepared for signing into law by early 2026.

Strategy creates $1.44 billion USD reserve, increases Bitcoin holdings to 650,000 BTC

Strategy, described as the world’s largest public Bitcoin holder, announced a $1.44 billion US dollar reserve to support dividend payments on its preferred stock and interest on outstanding debt. The reserve was funded through proceeds from sales of Class A common stock under the company’s at-the-market (ATM) offering program.

The company said its present plan is to maintain a USD Reserve sufficient to cover at least twelve months of dividends, with an intention to build the reserve over time to cover 24 months or more. Alongside the reserve, Strategy reported purchasing an additional 130 Bitcoin (BTC) for $11.7 million, bringing total holdings to 650,000 BTC, acquired for $48.38 billion.

According to a company update on Monday, the USD reserve will be the primary source for dividend payments to holders of preferred stock, as well as servicing debt and supporting common equity. The update stated the $1.44 billion reserve equals 2.2% of Strategy’s enterprise value, 2.8% of equity value, and 2.4% of Bitcoin value.

The company said the move enhances the quality and appeal of its preferred securities, debt, and common equity, adding that it raised $1.44 billion in less than nine trading days through sales of its Class A common stock, MSTR.

China reiterates crypto ban, cites renewed speculation and stablecoin risks

The People’s Bank of China (PBOC) said on Saturday it will reinforce its 2021 crackdown on cryptocurrencies, stating that “virtual currency speculation has resurfaced” and highlighting stablecoins as a particular risk.

“Virtual currencies do not have the same legal status as fiat currencies, lack legal tender status, and should not and cannot be used as currency in the market,” the PBOC said following a meeting with 12 other agencies, adding that “virtual currency-related business activities constitute illegal financial activities.”

The central bank said stablecoins pose concerns due to challenges in meeting customer identification and Anti-Money Laundering requirements, “posing a risk of being used for illegal activities.” It pledged to “persistently crack down on illegal financial activities” related to crypto to “maintain the stability of the economic and financial order.”

The 13 agencies participating in the meeting said they will “deepen coordination and cooperation” by enhancing information sharing and strengthening monitoring to track crypto-related activity.

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