The US Senate is set to take up long-awaited cryptocurrency legislation next week, with lawmakers preparing to debate the proposed Clarity Act that would establish a formal regulatory framework for digital assets and potentially reshape the industry’s future in the US.

Reuters reported that the bill, backed strongly by the crypto sector, seeks to define when crypto tokens qualify as securities, commodities or other financial instruments, providing long-sought legal clarity for companies operating in the market.

Tim Scott, chairman of the Senate Banking Committee, said the panel will hold an executive session on May 14 to consider the legislation.

A key provision in the bill addresses growing tensions between crypto firms…