The U.S. Senate is preparing for a key vote on a bill that could reshape the rules for stablecoins – digital currencies pegged to the U.S. dollar.
The legislation, supported by former President Donald Trump, aims to establish clear guidelines for using stablecoins in payments, reduce credit card fees, and boost market competition. A crucial procedural vote is expected on Wednesday, potentially paving the way for swift bipartisan approval.
🔹 Bipartisan support – but tensions rising
In recent weeks, the bill has gained backing from crypto-friendly Democrats such as Angela Alsobrooks and Mark Warner. Senate Majority Leader John Thune has prioritized the legislation, hoping it will advance both financial innovation and competition in card processing by challenging the dominance of Visa and Mastercard.
🔹 Opponents warn of security risks and conflicts of interest
Progressive Democrats, led by Senator Elizabeth Warren, have raised red flags. They argue the bill lacks necessary safeguards to prevent stablecoins from being exploited by criminals or foreign regimes. Critics also point to Trump's personal ties to the crypto world – a Trump-associated stablecoin has already reached a market valuation of over $2 billion.
Warren warned that the legislation could allow anonymous actors to use the stablecoin as “secret bank accounts” without oversight, and as a possible channel for bribing the former president. She described it as a "two-for-one deal for criminals."
🔹 Division among Democrats – support and fierce debate
While Warner called the bill “imperfect but a step forward,” Warren passionately opposed it. A heated argument even broke out between her and Senator Kirsten Gillibrand, a supporter of the measure.
🔹 Credit card reform emerges as another battleground
Another contentious part of the bill includes a proposal to force more competition in card payment processing. Senators Roger Marshall (Republican) and Dick Durbin (Democrat) want merchants to have access to multiple payment networks, not just Visa and Mastercard, to lower transaction fees.
However, Senate Banking Committee Chair Tim Scott has suggested that credit card rules should be handled separately from the stablecoin bill.
🔹 Negotiations ongoing, amendments still possible
Although preparations for the vote are underway, senators could still introduce amendments to modify the bill. Behind-the-scenes negotiations are continuing.
🔹 Banking sector on alert
Bankers fear that stablecoins could drain deposits from traditional banks, making it harder for small businesses and farmers to access credit. The banking industry has long tried – mostly unsuccessfully – to stop tech giants and major retailers from launching their own tokens.
#stablecoin , #TRUMP , #crypto , #Regulation , #USPolitics
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