Some Democrats supported the GENIUS Act, arguing that some regulation is better than none as cryptocurrency activity increases globally and the technology has the potential to revolutionize the US financial system.
But Hand told Ars that “we’ve already seen what happens when there are no protections” for consumers, like during the FTX collapse.
She joins critics that the BBC reported are concerned that stablecoin investors could get stuck in convoluted bankruptcy processes as tech firms engage more and more in “bank-like activities” without the same oversight as banks.
The only real assurances for stablecoin investors are requirements that all firms must publish monthly reserves backing their tokens, as well as annual statements required from the biggest companies issuing tokens. Those will likely include e-commerce and digital payments giants like Amazon, PayPal, and Shopify, as well as major social media companies.
Meanwhile, Trump seemingly wants to lure more elderly people into investing in crypto, reportedly “working on a presidential order that could allow retirement accounts to be invested in private assets, such as crypto, gold, and private equity,” the BBC reported.
Waters, a top Democrat on the House Financial Services Committee, is predicting the worst. She has warned that the law gives “Trump the pen to write the rules that would put more money in his family’s pocket” while causing “consumer harm” and planting “the seeds for the next financial crisis.”
Analyst: End of Trump’s crypto wins
The House of Representatives passed two other crypto bills this week, but those bills now go to the Senate, where they may not have enough support to pass.
The CLARITY Act—which creates a regulatory framework for digital assets and cryptocurrencies to allow for more innovation and competition—is “absolutely the most important thing” the crypto industry has been pushing since spending more than $119 million backing pro-crypto congressional candidates last year, a Coinbase policy official, Kara Calvert, told The New York Times.
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