The cryptocurrency legislation framework is facing two major hurdles: the controversy surrounding stablecoin yields and the conflict of interest involving the Trump family's crypto assets. Sources familiar with the matter told the media that whether the cryptocurrency bill can be passed this year remains highly uncertain. Recent policy debates in Washington have seen the banking and crypto industries holding differing opinions on the issue, causing delays and a standstill in the bill's progress. Trump, a strong supporter of cryptocurrencies, has also become embroiled in controversy, with Democrats heavily criticizing the government as a symbol of corruption.
The controversy surrounding stablecoin rewards has become a stumbling block to legislation.
The issue of stablecoin rewards remains the biggest point of contention in the cryptocurrency industry's legislative framework. Banks have heavily criticized the Genius Bill, arguing it will lead to a loss of depositors and harm the interests of community banks. Meanwhile, cryptocurrency industry players believe the issue has been discussed extensively, accusing banks of trying to restrict competition, with Coinbase's CEO being particularly vocal in his opposition. Cryptocurrency industry sources told The Block that discussions about stablecoin rewards have become almost daily topics of discussion. Representatives from banks and the cryptocurrency industry have met at the White House, striving to reach a consensus. However, sources familiar with the matter revealed that Republicans will only support the bill after the stablecoin rewards issue is resolved.
The banking sector has adopted a tough stance.
According to the disclosure , the bank has formulated a set of prohibitions regarding yields and interest, calling for a complete ban on any financial or non-financial benefits related to holding, owning, or using stablecoins for payments, strict enforcement of anti-circumvention measures, and strict restrictions on any marketing or advertising that may imply yields similar to deposit or insurance interest. This stance goes beyond the latest draft of the Market Structure Act, which prohibits yields or interest from passively holding stablecoins, but allows for a narrower scope. The bank has firmly stated that any proposed exemption from the stablecoin yield ban must be subject to extremely limited scope.
Trump's conflict of interest impacts bill's progress
Beyond the controversy surrounding the Genius Bill, ethical concerns have further complicated the legislation, particularly President Trump's ties to cryptocurrency. Bloomberg revealed that Trump has profited approximately $1.4 billion from cryptocurrency investments, with gains coming from World Liberty Financial. The Trump family also holds a 20% stake in American Bitcoin. Hammond, a lawyer and active advocate for the bill, stated that the Senate Banking Committee will raise Democratic concerns about Trump's personal ethics, as well as the controversy surrounding his family's active involvement in the cryptocurrency industry and government corruption, with SEC Chairman Paul Atkins at the hearing. Trump's strong connection to the cryptocurrency industry has become a major point of contention for Democrats.
The upcoming US midterm elections have added further uncertainty to the crypto market. Reportedly, political action committees focused on cryptocurrency policy are raising millions of dollars in preparation, and the political turmoil could also impact future investment performance in the crypto market. After a turbulent start to the year, whether Washington can fully pass the Digital Assets Act this year remains highly uncertain, and the uncertainty surrounding crypto policy adds further variability to the outlook.
This article, titled "US Cryptocurrency Bill Stalled, Trump's Conflict of Interest and Stablecoin Rewards as Key Factors," first appeared on ABMedia, a ABMedia .
