Democrats Threaten to Block Stablecoin Bill Over Regulatory Concerns
A group of nine Senate Democrats, who initially supported crypto-friendly laws, now oppose a major stablecoin bill. They claim the GOP-led proposal lacks necessary safeguards. This shift highlights growing disagreements on regulating the digital asset sector.
In a sudden statement, the senators said they won’t back the bill in its current form. They cited unresolved issues, including preventing illegal financial activities and ensuring national security.The bill aims to create the first federal rules for stablecoins, digital tokens tied to assets like the U.S. dollar.
Their main concerns include stopping illegal financial flows and stricter rules for overseas providers. They also want to ensure stablecoins don’t harm the existing financial system.
The Democratic group includes Senators Ruben Gallego, mark Warner, and Lisa Blunt Rochester. They previously voted for the bill but now say it has “numerous issues.” The letter also stressed a willingness to negotiate, saying, “We are eager to continue working with our colleagues.”
Notably, Democratic co-sponsors Kirsten Gillibrand and Angela Alsobrooks did not sign the statement. GOP lead sponsor Bill Hagerty warned that failing to act could make crypto legislation a solely Republican issue. The bill’s fate now hangs in the balance, with Democrats perhaps reshaping key provisions or stalling a notable regulatory breakthrough for the crypto industry.
Key points:
- democrats demand changes to prevent illegal financial activities.
- They want stricter rules for overseas providers and stronger penalties for noncompliance.
- The bill aims to create the first federal framework for stablecoins.
With the Trump family’s involvement in the digital asset space,the debate has become more complex. The senators’ move adds a new layer of complexity to an already contentious process.
