On a negative development for the US crypto industry, the highly anticipated stablecoins legislation has failed to advance in the US Senate after not receiving enough support from Senate Democrats. Several Republican senators have slammed the Democratic lawmakers for putting “partisan politics above policy.”
On Thursday, the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act failed to pass the cloture vote in the US Senate after several lawmakers withdrew their support in the past week.
In February, US Senator Bill Hagerty introduced the GENIUS Act to develop a framework to allow tokens like USDT and USDC to fall under the Federal Reserve Rules.
The bill, co-sponsored by Senators Tim Scott, Cynthia Lummis, Kirsten Gillibrand, and Angela Alsobrooks, would establish a “safe and pro-growth regulatory framework that will unleash innovation and advance the President’s mission to make America the world capital of crypto.”
The stablecoins legislation was considered a bipartisan effort to increase regulatory clarity after multiple Democrats showed support over the past few months. Additionally, the bill went through various amendments to address senators’ concerns, including stricter requirements for stablecoin issuers and Anti-Money Laundering (AML) provisions.
The lawmakers alleged that the draft bill omitted essential AML and national security safeguards and had ambiguous regulations that could expose crypto markets to exploitation.
The deal comprises a $2 billion investment connected to Binance and WLFI’s stablecoin. Warren affirmed that the Senate shouldn’t approve the crypto bill “to enable this type of corruption.”
It should have been a historic day for Americans (…) to see their financial system democratized (…). Instead, we witnessed a disappointing display of political gamesmanship that puts partisan politics above policy, and obstruction above innovation.
“Without it, stablecoins will be subject to a patchwork of state regulations instead of a streamlined federal framework that is more conducive to growth and competitiveness. The world is watching while American lawmakers twiddle their thumbs. Senators who voted to stonewall U.S. ingenuity today face a simple choice: Either step up and lead or watch digital asset innovation move offshore,” he concluded.
