Stablecoin Showdown: Crypto Bill Faces Collapse as Senate Democrats Withdraw Support
- Nine Senate Democrats who previously backed the bill now oppose it, citing unresolved concerns.
- The U.S.s first stablecoin regulatory framework faces collapse just days before a key Senate vote.
- While GOP leaders push for U.S. crypto dominance, Democrats demand stricter safeguards, and Trump-linked stablecoin plans add political tension.
Nine Democratic senators, who once supported pro-crypto laws, have now reversed course, and their action could prevent the passage of an important stablecoin regulation proposal. Their actions are also a sign of growing differences in opinion on the proper regulatory framework for the fast-expanding crypto sector.
In a statement first shared by Politico, the senators stated that there are several unresolved concerns in the bills current form. Hence, they wont support it.
The senators demanded a change in five focus areas. These areas include anti-money laundering protections, better regulations for foreign stablecoin issuers, national security controls, tough sanctions for violators, and assurances that any systemic risk from the industry wont affect traditional finance.
Stablecoin Regulation Hangs in the Balance
This development comes days before a key vote to approve the United States first regulatory framework for stablecoin issuers. These stablecoins are cryptocurrencies designed to maintain an equal value with the U.S. Dollar or other traditional currencies like the euro.
After supporting the crypto bill previously, the Senate Democrats now argue that the bill has multiple issues that needs to be fixed before they can support it again. These senators are Andy Kim, Ruben Gallego, Mark Warner, and Lisa Blunt Rochester, who represent New Jersey, Arizona, Virginia, and Delaware, respectively.
In a letter signed by six other senate democrats, the senators stated the need for collaboration that cuts across party lines to develop a detailed regulatory playbook for stablecoins as they continue to gain mainstream adoption.
GOP Pushes Crypto Dominance
Meanwhile, in his response to the development, the primary sponsor of the bill, Republican Senator Bill Hagerty, said the bill was necessary to help the U.S. secure and maintain a leading position in the cryptocurrency space. With the bills passage now uncertain, democrats now hold the power to stop an important crypto regulation or make significant revisions to it.
This development further complicates an already tense process and adds political sensitivities given the Trump familys plans to launch a new stablecoin.
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Read more: https://www.tronweekly.com/stablecoin-showdown-crypto-bill-faces-collapse/
Text source: TronWeekly
