Laws move slower than markets. But they hit harder. This is issue #86 of The Bitcoin Act: your Tuesday and Sunday briefing on the legal and regulatory moves that actually shape Bitcoin.

Now for today’s top stories:

🧾 Illinois Delays Its 0.2% Tax
Illinois agreed to push its 0.2% tax on Bitcoin and other token trades from January 1 to July 1, 2027, if a judge approves the deal.

🇺🇸 Begich Pushes Permanent Bitcoin Reserve
Rep. Nick Begich says his pending reserve bill would hold U.S. Bitcoin at least 20 years and protect your right to self-custody.

🏛️ Lummis Blames Democrats on CLARITY (again)
Sen. Cynthia Lummis says Democrats rejected the CLARITY Act despite getting the $150 million they wanted for financial crime enforcement.

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Mike Belshe (CEO, BitGo) warned that the CLARITY Act's Senate defeat lets firms like Coinbase combine trading, brokerage and custody, a concentration he called potentially worse than Lehman's 2008 collapse.

Sen. Cynthia Lummis (R-WY) said Democrats voted against the CLARITY Act although it included the $150 million they requested for FinCEN, the Treasury's financial crimes unit.

Johann Kerbrat (SVP, Robinhood) said the SEC's innovation exemption, which lets venues trade token versions of U.S. stocks without registering as exchanges, sets volume caps Robinhood's stock tokens already approach.

Rebeca Romero Rainey (CEO, Independent Community Bankers of America) argued national trust charters, federal custody licenses granted by the OCC, give digital asset firms an unauthorized "side door" into banking.

Mike Selig (CFTC Chairman) argues his agency alone regulates prediction markets like Kalshi, and sent rules defining event contracts as swaps, federally regulated derivatives, not state-policed gambling.

Mike Selig also credited departing SEC Commissioner Hester Peirce with defending builders against debanking and regulation by enforcement, policy made through lawsuits, when few others would.

Christine Lagarde (President, European Central Bank) said payment providers' feedback on the digital euro, a planned state-issued digital cash, is valuable, and invited online shops into its 2027 pilot.

Sen. Richard Blumenthal (D-CT) claimed in a Senate staff report that Tether's dollar-pegged USDT is a "significant financial lifeline" for Iran's shadow banking; Tether says it helped freeze about $550 million in Iran-linked funds.

Isabel Schnabel (Executive Board member, European Central Bank) argued that whatever model brings bank reserves onto token-based trading platforms, central bank money must remain the asset that finally settles trades.

Rep. Nick Begich (R-AK) argues his American Reserve Modernization Act would create a permanent Bitcoin reserve held at least 20 years and protect Americans' right to self-custody.

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🏦 3 – The European Central Bank presented 3 ways to move central bank money onto token-based settlement networks, where an asset and its payment change hands at the same instant. The Block

🔐 60 days – The Securities and Exchange Commission proposed a rule letting investment advisers and funds hold client Bitcoin themselves when no approved custodian is available, with public comments open for 60 days. SEC

🧾 0.2% – Illinois agreed to delay its 0.2% tax on Bitcoin and other token trades and custody from January 1 to July 1, 2027, if a judge approves. Industry groups are still asking the court to strike the tax down. CoinDesk

🇬🇧 5 months – Britain's Financial Conduct Authority, the country's financial regulator, gave Bitcoin firms 5 months, until the end of February 2027, to apply for a license. The new rules take effect in October 2027. FCA

🏛️ $2.4 billion – The Justice Department said it will not reopen its criminal investigation into Jerome Powell over the central bank's $2.4 billion headquarters renovation. The Federal Reserve's internal watchdog found poor cost control but no grounds for criminal charges. Reuters

🏛️ Already gone – U.S. Senate – The Senate adjourned September 30 for the last time before the November 3 midterms, so no second cloture vote (the 60-vote step needed just to start debate) on the CLARITY Act can happen before the election.

🇺🇸 Possible this week – CFTC crypto market rules – The White House's short review of the CFTC's early-stage rules for Bitcoin and token trading venues has run its course. Next: a commission vote and public release.

🧾 Open all week, closing October 30 – Illinois Department of Revenue, public comments on draft tax rules – Illinois is taking comments on its draft rules for the 0.2% tax on Bitcoin and other token trades, transfers and storage. Your chance to weigh in before the rules are final.

🇵🇱 Monday, October 5 – Bitcoin Poland, Poznań Congress Center – Day one of Poland's first Bitcoin-only conference, with panels on Bitcoin rules in Europe after MiCA. 

📝 Monday, October 5 – SEC custody proposal, comment window – The Securities and Exchange Commission's 60-day public feedback period on letting advisers and funds hold client Bitcoin themselves is expected to be underway.

🇪🇺 Tuesday, October 6 – Digital euro pilot information session, online, 3:00 p.m. Central European Time – The European Central Bank explains its 2027 test of a state-issued digital euro to merchants and anyone interested, consumers included.

🇩🇪 Tuesday, October 6 – Open Banking and PSD3 Europe Forum, Hilton Frankfurt City Centre – Bankers and policymakers discuss PSD3, the European Union's next payments law, plus fraud checks and digital identity.

🇸🇬 Wednesday, October 7 – Digital Asset Summit Asia, Marina Bay Sands, Singapore – Blockworks' one-day institutional summit with BlackRock, Fidelity and Nasdaq speakers. Mostly stablecoins and tokenized markets, but listen for what big custodians say about holding Bitcoin.

"A society that puts equality before freedom will get neither. A society that puts freedom before equality will get a high degree of both." — Milton Friedman

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