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Retail and cryptocurrency trade groups converged Thursday to air their shared interest in supporting legislation to create a regulatory regime for stablecoins, and they did so on a day when the Senate Banking Committee approved a bill attempting to do just that.
The Merchants Payments Coalition and the cryptocurrency interest trade group Payment Choice Coalition issued a joint press release Thursday to say they’re working together to promote “innovation, competition and choice in U.S. payments.”
The MPC, which represents the National Association of Convenience Stores and the National Restaurant Association, among others, has lobbied for bills that they argue would benefit major and smaller retailers when it comes to payments, including the Credit Card Competition Act .
The PCC is a coalition that represents varied entities, including the Association of Kentucky Fried Chicken Franchisees as well as the crypto exchange company Coinbase, according to the press release.
While teaming up to state their shared interests, the MPC and the PCC also seemed to diverge on some points. In the release, the MPC endorses stablecoin legislation that will allow a “reliable regulatory structure for stablecoins,” while the PCC backs legislation that will “ensure a competitive payments landscape.”
A spokesperson for the MPC said it’s not supporting any specific stablecoin legislation at this time. A spokesperson for the PCC didn’t respond to a request for comment.
The legislation that passed the Senate committee is known as the Genius bill, the Guiding and Establishing National Innovation for U.S. Stablecoins Act. The bill was introduced by Sen. Tim Scott, a South Carolina Republican, and mainly backed by members of his party, but won some Democrats’ support.
The passed the committee on an 18-6 committee vote, according the news outlet CoinDesk . Sen. Elizabeth Warren of Massachusetts, the ranking Democrat on the committee, argued against the bill.
One of the banks’ major interest groups, the American Bankers Association, made clear that it did not support the Genius bill.
“We urge the Committee to avoid establishing a framework that disintermediates the banking industry by incentivizing a flow of deposits out of community banks and into payment stablecoins,” the ABA said in a Thursday statement .
The House Financial Services Committee held a hearing Tuesday on a similar bill, called the Stable Act, but it has some differences.
The House version has a path to allowing issuers to be state regulated, the Senate bill mostly limits the ability to be regulated by states to smaller issuers, said Jennifer Schulp, who is the director of financial regulation studies at the Cato Institute, a libertarian public policy group.
The Senate bill has a more involved process for the federal government sanctioning state oversight, she said. There is also more heft in the Senate bill regarding standards vis-a-vis foreign coins, she added.
“There does seem to be momentum in the same direction on a similar regulatory framework for stablecoins in both the House and the Senate,” Schulp said in an interview Tuesday. “There's still things to be ironed out, but the general thrust of the regulation in both of these bills is the same.”
While there has been similar stablecoin and cryptocurrency legislation introduced in Congress in the past, the two parties failed to reach a consensus. That may change in this Congress, partly because Republicans control the Senate and Republican President Donald Trump has prioritized digital assets, issuing an executive order to that effect in January.
The Biden administration was more skeptical of the crypto industry, and under its watch the Securities and Exchange Commission and the Justice Department brought significant enforcement actions against crypto companies, including Coinbase.
The increase in support for digital assets and related legislation, on both sides of the aisle, is related to the crypto community’s support for candidates, both Democrats and Republicans, explained Schulp, a former enforcement director at the Financial Industry Regulatory Authority. Crypto interests poured more than $130 million into the 2024 elections, according to OpenSecrets, which tracks political contributions.
“Crypto was an issue in the last election, even at the House and Senate level,” she said. “I think we're seeing more interest in working on these issues and prioritizing these issues from Republicans and Democrats alike.”
