Consumer advocates and financial reform groups are lining up alongside some labor unions to oppose Senate legislation that will impose regulations on U.S. crypto markets, arguing that current versions make crypto consumers vulnerable to fraud.
“Legislative initiatives explored thus far in the Senate have largely failed to address the
“The widespread harm caused by the crypto industry and the Senate should not consider any bill that does not address these issues in their entirety,” said the letter sent to senators this week, signed by nearly 200 groups including Better Markets, Public Citizen, Americans for Financial Reform and Communications Workers of America. It follows a similar objection raised this week by the teachers union, the AFT.
Although the House of Representatives earlier this year passed a bill to govern crypto in the United States, the Digital Asset Market Clarity Act, the Senate continues to craft its own version, largely based on the Clarity Act but pursuing different approaches. Senators negotiating the bill in closed session said the process was almost complete, and one of them — Sen. Cynthia Lummis — said Tuesday she hoped the bill could still move toward formal markup next week.
One of the main points of the debate concerns Democrats’ concerns about apparent conflicts of interest related to the involvement of government officials – notably President Donald Trump – in crypto companies as they determine industrial policy. The letter from progressive groups also touches on this point.
“Any legislation must effectively address the corrosive and unprecedented impacts of President Trump and his family’s conflicting investments in various crypto businesses,” he said.
Lummis said she worked on the bill’s ethics provisions with a Democratic colleague, but the White House has so far rejected the proposals.
The consumer advocates’ latest letter of opposition was also signed by progressive environmental groups that don’t typically intervene in financial policy, including Greenpeace, the Center for Biological Diversity, and Animals Are Sentient Beings, Inc.
A divide has developed among Democratic lawmakers over support for crypto legislation, with Sen. Elizabeth Warren, the ranking Democrat on the Senate Banking Committee, leading some of the more progressive members in criticizing the effort.
“This legislation poses serious risks to the retirements of working families and to the overall stability of the economy,” according to the letter from the teachers union, which focuses its concerns on the dangers posed to its members’ retirement funds by the United States’ adoption of cryptocurrency. “Rather than remaining silent on crypto, this bill removes the few safeguards that exist for crypto and erodes many protections for traditional securities. If passed, it will compromise the security of many assets and cause problems in retirement investments.”
Despite the misgivings of some Democrats, Congress has managed to advance bipartisan votes on crypto legislation, including the new stablecoin law approved earlier this year.
Read more: Teachers union says US Senate crypto bill puts pensions, economy at risk: CNBC
