The push for U.S. legislation to regulate stablecoins hit a roadblock on Thursday as Democratic opposition prevented the bill from advancing to a debate phase in the Senate. This setback comes despite bipartisan support for the bill in the Senate Banking Committee.
The bill, which aims to regulate stablecoins like Circle’s USDC and Tether’s USDT, failed to secure the necessary 60 votes to move into a debate phase, with Senators Josh Hawley and Rand Paul breaking ranks with Republicans to vote against it. Senate Majority Leader John Thune also voted against advancing the legislation, signaling a procedural move to revisit the bill at a later date.
Several Democrats who had previously expressed support for the bill raised concerns about the need for stronger safeguards against illicit activities, citing potential conflicts of interest related to President Donald Trump’s ties to the crypto industry. Senator Ruben Gallego, who received significant backing from crypto industry PACs, called for more time to refine the legislation and address these concerns.
Senator Mark Warner emphasized the importance of regulating stablecoins, describing them as a key component of the future of finance. He stressed the need for additional protections in the bill before moving forward with a debate.
While some Democrats called for a pause to further refine the legislation, Republicans like Senator Cynthia Lummis urged the Senate to proceed with an open debate to make necessary changes. Senator Bill Hagerty warned that voting against opening the debate could harm the crypto industry in the U.S.