Law of Code #165 - Key developments in U.S. crypto law & policy with Jonathan Schmalfeld
Dec 15, 2025
Jonathan Schmalfeld, Policy Director at the Digital Chamber, dives into the latest shifts in U.S. crypto law and policy. He unpacks the bipartisan Senate Agriculture Committee's draft, highlighting the missing sections on DeFi and AML. Schmalfeld also discusses the IRS's new guidance on staking for ETFs, and Uniswap's recent fee switch vote. The conversation touches on the implications of a mistrial in the MEV exploit case and the Dept. of Justice's controversial filing against Tornado Cash, while unveiling initiatives like the Digital State Network to support crypto advocacy.
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Bipartisan Draft Leaves Hard Issues For Later
- The Senate Agriculture Committee's bipartisan market-structure draft follows token classification clarity but leaves DeFi and AML sections blank.
- That signals early bipartisan agreement on basics while reserving the hardest political fights for later negotiation.
Token Taxonomy Reduces Legal Ambiguity
- SEC Chair Gary Gensler emphasized the need for a token taxonomy so regulators and markets use consistent language.
- Jonathan argues consistent definitions reduce litigation risk and improve legislative and regulatory clarity.
IRS Guidance Unlocks Staking For ETFs
- Treasury and the IRS clarified that crypto ETFs can stake assets and pass staking rewards to investors under certain rules.
- That guidance resolves major tax uncertainty and will shape whether issuers offer staked-product ETFs or simply stake held assets.