House Financial Services Committee members appeared to be off-course Wednesday as they spent hours repeating a message that was echoed by Democrats: While Democrats would support STABLE Act legislation in principle, President Donald Trumps’ personal involvement with the bill is not acceptable. Stablecoin Sector as an incompatible conflict of interests.
On Wednesday, multiple Democrats, including the co-sponsors of the STABLE Act, proposed amendments that would prevent the president, first lady and government officials like Elon Musk, from selling stablecoins while they were in office.
Over the course of hours, the Committee's slim Republican majority shot down each of those amendments by voice vote.
Republican leadership countered the proposals by arguing the STABLE Act currently requires all issuers to comply with the same rules, and that boxing out certain issuers—even the sitting president himself—would stifle market competition. All stablecoin issuers in the US would need to follow a specific set of rules involving anti-money laundering and reserve audits.
“We're not picking winners and losers here,” Committee Chair French Hill (R-AR) said. “If you don't want to use a payment stablecoin, don't use one.”
Many Democrats have criticized the World Liberty Financial stablecoin that was recently launched by the Trump Family. One dollar coinIt should be treated as any other.
“He is unlike any other issuer because he's the president of the United States,” Rep. Stephen Lynch (D-MA) retorted. “And he's going to take U.S. taxpayer money to assist his family business when it gets in trouble.”
Stablecoins, digital assets tied to the U.S. dollars, allow crypto traders to trade without needing to directly access dollars. Some stablecoins issuers such as the Trump-backed World Liberty Financial claim that they are strengthening U.S. dollars hegemony in the digital and foreign markets by encouraging dollar-backed assets. In the absence of a regulatory structure in the United States the legality remains uncertain.
Trump’s family is a wealthy and influential group crypto investments Since the President returned to the White House and is overseeing the development of the first-ever digital asset regulatory framework in the United States, there has been some controversy. But the Trump family’s announcement last week of a stablecoin product—right at the moment that stablecoin legislation is moving quickly through both chambers of Congress—appears to have struck a particularly resonant chord with Democrats.
Inadvertently, the timing of this event appears to be incorrect. Sources with knowledge on the subject confirmed Decrypt World Liberty had not intended to launch its stablecoin this soon. It is not clear when World Liberty will launch the stablecoin. You can find out more about this by clicking here. The team was forced to act by the blockchain data about the product.
There is no indication that the recent controversy surrounding Trump’s crypto-dealings will change anything in the equation for bipartisan support of the STABLE Act. This act was widely expected to garner a number of Democratic votes. One House Financial Services Committee employee told Decrypt They do not expect much to change in the Democrat’s support of the bill after today’s markup.
Rep. Hill, Republican Chair of the Committee, made a rare move on Monday. that Trump’s crypto dealings—particularly, the president’s stablecoin and What is that? projects—have made the task of creating legislation in the same areas “more complicated.”
Sam Liccardo, D-CA, one of the Democrats co-sponsoring STABLE Act and a strong critic of Trump’s crypto deals on Wednesday. Liccardo declared that it was’self-evident’ and ‘obvious” to stop high-ranking government officials from creating their own stablecoins. He also highlighted how such tokens could be used by foreigners to curry favor with Trump.
One House staffer who is familiar with House Financial Services Committee work said Decrypt, however, that Democrats who already cosponsored the bill embraced it last month as it was written then—and are unlikely to change their positions over tweaks that, while important, may not be existential.
The staffer explained that “you can see what happens if these amendments are not accepted.”
