Consumer advocates and financial reform groups are lining up with some labor unions in opposition to Senate legislation that would impose regulations on US crypto markets, arguing that the current versions leave crypto consumers vulnerable to fraud.
“The legislative initiatives considered in the Senate so far have largely failed to address the problem
widespread harm caused by the crypto industry and the Senate should not consider a bill that does not fully address these issues,” said the letter sent to senators this week, signed by nearly 200 groups, including Better Markets, Public Citizen, Americans for Financial Reform and the Communications Workers of America. It followed a similar objection raised this week by the teachers’ union, AFT.
Although the House of Representatives earlier this year passed a bill to govern crypto in the US, the Digital Asset Market Clarity Act, the Senate continues to hash out its own version, largely built on the Clarity Act, but pursuing some different approaches. The senators negotiating the bill behind closed doors have said the process is nearing completion, and one of them — Sen. Cynthia Lummis — said Tuesday she hopes it can still reach a formal markup next week.
One of the main points of discussion is Democrats’ concerns over apparent conflicts of interest in government officials — particularly President Donald Trump — who are involved in crypto companies while determining industry policy. The progressive groups’ letter also hit on that point.
“Any legislation must effectively address the unprecedented and corrosive effects of President Trump and his family’s conflicted investments in various crypto ventures,” it said.
Lummis said she had been working on ethics provisions for the bill with a Democratic colleague, but the White House has so far rejected the proposals.
The latest letter of opposition from consumer advocates was also signed by progressive environmental groups that don’t normally weigh in on fiscal policy, including Greenpeace, the Center for Biological Diversity and Animals Are Sentient Beings, Inc.
A rift has emerged among Democratic lawmakers over backing 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 profound risks to the pensions of working families and the overall stability of the economy,” according to the teachers’ union letter, which focuses its concern on the dangers to members’ pension funds posed by America’s embrace of cryptocurrency. “Instead of simply being silent on crypto, this bill removes the few safeguards that exist for crypto and erodes many protections for traditional securities. If passed, it would undermine the safety of many assets and cause problems across pension investments.”
Despite loud pushback from some Democrats, Congress has managed to move forward with top votes on crypto legislation, including the new stablecoins law approved earlier this year.
Read more: Teacher’s Union Says US Senate Crypto Bill Puts Pensions and Economy at Risk: CNBC
