Senate Banking Committee Advances Crypto Stablecoin Bill

The U.S. Senate Banking Committee has advanced a regulation bill for the crypto industry’s stablecoins, marking a pivotal step towards potential presidential approval.

With a committee approval of 18-6, the bill aims to regulate U.S. stablecoin issuers federally and now requires a full Senate vote. A similar bill is awaiting the House of Representatives’ approval. However, obstacles remain, including reconciling differing versions from both chambers.

Democrats on the committee recognized the bill’s necessity but sought additional amendments for stricter regulatory measures, all of which were dismissed. Senator Elizabeth Warren voiced strong objections, claiming the bill poses a “clear threat to our national security.” She expressed her frustration during a lengthy hearing, arguing against advancing a bill with significant flaws, especially amid reports of Donald Trump pursuing a stablecoin deal with a controversial company.

Another Democratic senator, Catherine Cortez Masto, criticized Republicans for not fully engaging in the discussion. “It is a great start, but it is not ready for prime time,” she stated.

Republican Senator Bill Hagerty, the bill’s primary author, touted the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act) as a bipartisan initiative that includes contributions from Democrats. He argued that the bill offers sensible regulations that enhance consumer protection, competition, and innovation.

The cryptocurrency industry is relying on strong bipartisan support this year, as evidenced by recent successes in removing unfavorable IRS rules.

Historically, the Democratic-majority Senate Banking Committee previously stalled crypto legislation, but the 2024 elections have allowed Republicans to prioritize stablecoin regulation.