US House passes stablecoin legislation

Cryptocurrency industry secures one of its main legislative objectives and makes progress towards a second one

- DAVID YAFFE-BELLANY ROBERT JIMISON

The cryptocurrency industry reached a major milestone in Washington on Thursday, as Congress cleared legislation outlining the first federal rules for stablecoins, a popular form of digital currency.

A bipartisan vote in the House to approve the bill, known as the Genius Act, sent it to the White House for President Trump's signature. He has promised to make it the first major piece of crypto legislation signed into law in the United States.

But even as the industry and its backers notched their first big policy victory, the fate of a potentially more consequential digital currency regulation bill still working its way through Congress was in doubt.

The House on Thursday also passed the Clarity Act, sending the Senate legislation that would establish cryptocurrency market regulations that industry executives have championed for months.

At the heart of that measure are provisions that would weaken the power of the Securities and Exchange Commission to police crypto and instead hand more control to the Commodity Futures Trading Commission. That could shield the industry against the kind of aggressive enforcement the SEC undertook in Joe Biden's administration, when regulators filed lawsuits against a procession of major crypto firms, and instead empower a commission that is seen as much more friendly to it.

‘The Clarity Act “has been absolutely the most important thing we have been pushing for,” said Kara Calvert, a top policy official at Coinbase, the largest US crypto exchange and a longtime target of the SEC.

The measures passed over the vociferous opposition of most Democrats, who argued that the legislation would hand the crypto industry a lax set of regulations it had written itself to benefit wealthy players, including Trump's own family, as they sought to enrich themselves.