The Senate will vote on a Trump-backed stablecoin bill on Wednesday.
Some Democrats say it helps Trump and could help criminals.
The account also pushes lower card fees through increased competition.
Senate Majority Leader John Thune has scheduled a key procedural vote for Wednesday on stablecoin legislation backed by both the cryptocurrency industry and Donald Trump.
The vote, which needs support from 60 senators , clears the way for bipartisan legislation in the coming days.
This comes after reviews last month that, among other things, support from Democratic crypto senators like Angela Alsobrooks and Mark Warner.
John Thune focuses on adding competition to credit card processing with the account
The StableCoin bill is crucial because it would create rules for dollar-backed tokens used to make payments. It is worth noting that stablecoins must be backed by reserves held in short-term investments, such as those overseen by federal debt or state regulators.
As the Senate prepares to vote on a Trump-backed StableCoin bill, debates have been sparked over the bill.
Progressive Democrats have expressed concern that the bill lacks safeguards to prevent stablecoins from endangering the financial system or being exploited by criminals. They also argue that it skirts the issue of Donald Trump profiting from his cryptocurrency ventures.
However, Thune’s move to shut down debate on the bill is virtually certain that the legislation will contain language pushed by retailers and their allies in the Senate to force competition from Visa Inc. and MasterCard Inc. in credit card processing.
To support this claim, the proposal, supported by Republican Sen. Roger Marshall and Democratic Sen. Dick Durbin, would require big banks to allow merchants to choose among multiple credit card networks.
This includes alternatives to Visa and MasterCard. The goal is to increase competition and reduce transaction fees for merchants.
On the other hand, Senate Banking Chairman Tim Scott indicated that his committee may consider the credit card rules as separate legislation instead of including them in the StableCoin bill.
That didn’t stop Marshall from focusing on achieving his goal. On Monday, June 9, Marshall said he was planning his next move and wanted to schedule a vote on the legislation soon.
A Senate aide said late Monday that talks were continuing on the bill and that senators could still offer amendments to the plan.
StableCoin Bill Faces Criticism as Concerns Grow Among Individuals
A stablecoin linked to the Trump family has seen its market value rise $2 billion since its announcement in March, but has also faced criticism.
However, Democratic Sen. Mark Warner of Virginia, a key banking committee moderate, said he would support the measure. He also said concerns about the Trump family’s business activities should not impede progress on broader stablecoin legislation.
Warner described the legislation as "not perfect but much better than what we currently have."
On the other hand, the party’s progressive faction, led by Elizabeth Warren, the highest-ranking Democrat on the Senate Banking Committee, Strongly opposed it. During an early vote, Warren and Sen. Gillibrand had a heated exchange on the Senate floor.
Warren shared a new analysis from her staff criticizing the bill for not including any prohibition on Trump and his family benefiting from cryptocurrencies regulated by his administration. The analysis also highlighted loopholes that could allow criminals and terrorists to abuse stablecoins for transactions outside of traditional banks.
Warren warned that the passage of this bill means they can expect more anonymous buyers — Big Business and foreign governments — to use the president ’s dent as a secret bank account free of government oversight and as a way to pay off the dent’s presence. She added that for criminals, it was a two-for-one deal.
Bankers also worry that stablecoins could take away bank deposits and make it harder for small businesses and farmers to get loans. These groups often depend on banks for credit. So far, bankers have tried — mostly unsuccessfully — to block large companies, such as tech companies or retailers, from creating their own tokens.
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