A Democrat Pushes for 11th-Hour Compromise on Stablecoin Legislation
During a recent hearing on the House Financial Services Committee, a key Democrat took the opportunity to advocate for a last-minute compromise on stablecoin legislation. The hearing also featured Republican members questioning Securities and Exchange Commission Chair Gary Gensler on his oversight of the crypto industry and the agency’s reliance on enforcement actions.
Representative Maxine Waters, the ranking Democrat on the committee, proposed during the Securities and Exchange Commission oversight hearing that she and the Republican chairman work together to finalize a bill regulating U.S. stablecoin issuers. She emphasized the importance of reaching a deal that prioritizes consumer protections and federal oversight.
Although the committee’s chairman, Representative Patrick McHenry, expressed hope for passing stablecoin legislation in this Congress, he acknowledged the challenges in garnering enough support for the bill. The window for passing legislation is narrowing as the congressional session progresses.
The SEC hearing, which featured all five commissioners testifying simultaneously, quickly turned into a debate on crypto regulation. McHenry and other Republicans criticized the agency’s approach to the industry, with McHenry labeling the SEC as a “rogue agency” under Chair Gensler’s leadership.
Chair Gensler defended the SEC’s enforcement actions, stating that the agency focuses on the economic aspects rather than specific terms when determining crypto security status. However, McHenry and others argued that the agency’s lack of clarity has created confusion in the industry.
Republican Commissioner Hester Peirce expressed dissatisfaction with the agency’s deliberate ambiguity in defining token transactions as securities, noting that it has failed in its regulatory duty. Additionally, Republican lawmakers recently called for the repeal of the SEC’s crypto accounting policy, SAB 121, which has caused uncertainty among U.S. banks regarding custody of crypto assets.