Stablecoin Legislation Advances in U.S. House of Representatives
On Wednesday, a significant milestone was reached in the realm of U.S. stablecoin legislation as a committee from the House of Representatives joined their Senate counterparts in advancing a pivotal bill for consideration by the entire House. This progression brings the prospect of stablecoin regulation closer to fruition.
Should both the House and Senate grant their approvals, lawmakers will embark on the process of merging the two versions into a cohesive piece of legislation, potentially leading to a final vote. Republican lawmakers, alongside former President Donald Trump, have set an ambitious target of completing this initiative by August.
The crypto industry and its staunch Republican allies in Congress were pleased to see multiple Democrats supporting the advancement of the Stablecoin Transparency and Accountability for a Better Ledger Economy (STABLE Act) during the House Financial Services Committee meeting. However, the Democratic members expressed ongoing concerns regarding Trump’s ties to the industry and the implications for stablecoins. Despite these reservations, five Democrats joined 27 Republicans to push the bill forward after an extended markup session.
A week prior to the committee’s markup session, the World Liberty Financial (WLFI), which has connections to Trump, announced its support for its own stablecoin, USD1. Trump has been actively involved in the crypto space, including selling non-fungible tokens (NFTs) and promoting the memecoin $TRUMP, while advocating for crypto-friendly policies at the federal level.
The regulation of stablecoins, which are typically pegged to the U.S. dollar, such as Tether’s USDT and Circle’s USDC, remains a top priority for the industry. Committee Chairman French Hill emphasized the need for innovation, stating, “Innovation needs guardrails, not roadblocks.”
Republican committee members chose not to explicitly address President Trump’s involvement in the industry. When Representative Maxine Waters and other Democrats proposed amendments aimed at mitigating potential conflicts of interest arising from Trump’s business dealings and his authority over regulators, these proposals were dismissed by the Republican majority, who labeled such protections as “unnecessary.”
Hill defended the committee’s approach, asserting, “We don’t discriminate on entrepreneurs based on who they are and where they come from.” He reiterated that to establish clear regulations in this sector, the passage of the bill is essential.
In a pointed remark, Waters accused Trump of “leveraging the power of the presidency to establish multiple crypto schemes to enrich himself and his family,” calling it a blatant “display of greed.” Representative Stephen Lynch, the ranking Democrat on the digital assets subcommittee, argued that Trump, as the sitting president, holds a unique position that could compromise the integrity of regulatory decisions regarding his own business interests. Lynch remarked, “If this was a Democratic president trying to do this, the Republicans’ hair would be on fire, and rightly so. This should not be happening.”
Another Democrat, Illinois Representative Sean Castin, raised concerns about the significant investments made by Tron’s Justin Sun into WLFI, suggesting that these financial ties could unduly influence government officials associated with stablecoins, potentially obscuring foreign investors’ involvement from public scrutiny. Despite these concerns, the Republican majority on the committee dismissed the proposed amendments, allowing the bill to advance without changes.
Supporters of the bill believe that the House version aligns closely with the Senate’s proposal. Michigan Republican Representative Bill Huizenga stated that the House version appropriately maintains considerable authority with state regulators, providing a “lighter touch, at times.”
Huizenga concluded, “We have an administration that is ready to embrace these products, and the time is now.”
This was just one of several pieces of legislation discussed by the House Financial Services Committee addressing cryptocurrency-related issues. Another bill considered aimed to establish a cross-government coalition of law enforcement agencies to combat illicit cryptocurrency activities, while a separate proposal sought to ban U.S.-issued central bank digital currency (CBDC).
Lawmakers also voted on numerous amendments related to the stablecoin bill before ultimately advancing it, with Rep. Lynch humorously noting that the committee may have set a record for the most failed votes in succession. The cross-government initiative, known as the Financial Technology Protection Act, passed with unanimous support at 49-0, while the anti-CBDC bill garnered 27 votes in favor, with 22 against. Initially, lawmakers faced challenges with their electronic voting system, but they regained momentum after commencing votes around 10:30 p.m. ET, nearly 12.5 hours after the markup began. The voting on all five bills concluded shortly before 11:15 p.m. ET.
As the stablecoin bill continues to progress, Trump is also expected to sign the first pro-crypto congressional action: a resolution that repeals an Internal Revenue Service rule targeting decentralized finance (DeFi) operations. While the president has not yet announced a timeline for signing this resolution, it marks a significant step forward for the crypto community.
UPDATE (March 3, 2025, 01:15 UTC): Additional vote totals added.
