The bill lost all of its democratic support just before the vote and failed to win the 60 votes needed to move forward.
WASHINGTON – On May 8, the US Senate did not advance legislation regulating “stablecoins” in the cryptocurrency market, taking a blow to bipartisan efforts widely supported by the industry.
Guidelines and establishment of national innovation for the US Stablecoins (Genius) Act, sponsored by Senator Bill Hagerty (R-Tenn.), aims to bring about a regulatory system for the Stablecoins market. Stablecoins are attractive to larger risk aversion investors, including advanced funds, sovereign funds, asset managers, and wealthy family firms. The bill, among other rules, requires permission to issue stable coins by lenders, prevent the lenders from “relocating” stub coins, describe the boundaries between state and federal regulators.
After it was introduced, Genius Law had several democratic advocates and co-sponsors. This indicates that you may receive the 60 votes needed to solidify to avoid the filibuster and advance to the final passage. However, on May 3, several Democrat senators led by Sen. Reuben Gallego (D-Ariz.) announced they were withdrawing support from the bill unless changes were made to address concerns about what was called flaws in the bill’s security clause. They did not identify the flaws, but they called for “stronger provisions on money laundering, anti-money laundering, foreign issuers, national security, maintaining the safety and soundness of our financial system, and accountability for those who do not meet the requirements of the law.”
The coagulation movement considered on May 8th failed with 48-49 votes.
All Republicans voted in favor of the bill except for Senators Rand Paul (R-Ky.) and Josh Hawley (R-Mo.). Senate Majority Leader John Tune (Rs.D.) voted for “Nay” only to provide a “motion to reconsider” the bill at a later date. Even Senator Kirsten Gillibrand (DN.Y.), who co-hosted with Hagerty and three other senators, did not vote in favor of the bill.
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The Senate Democrats were hoping for a revised text of the bill, which may have fulfilled their concerns, as Gallego and the signatories had expressed until shortly before the vote. The Democratic senator cited the Trump family’s involvement in the stubcoin market as the reason for this and why he voted against coagulation.
It is still unclear whether the bill will be reconsidered. Hagerty’s office did not immediately respond to requests for comment.
