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US Stablecoin Bill Introduced as UK Races for Summer Crypto Legislation Amid Election Pressures

Last Updated April 18, 2024 3:50 PM
James Morales
Last Updated April 18, 2024 3:50 PM

Key Takeaways

  • Senators Cynthia Lummis and Kirsten Gillibrand have introduced a new stablecoin bill to Congress.
  • Anti-crypto Senators have blocked Lummis and Gillibrand’s previous attempts at regulating the sector.
  • Meanwhile, the UK government plans to introduce new crypto legislation in June or July.
  • Facing a general election after Parliament returns from its summer recess, the UK government is under pressure to deliver the new bill quickly.

With both countries facing critical elections in the Fall, lawmakers in the US and the UK are pushing to move crypto regulation forward at a time of political uncertainty. 

Stateside, Senators Cynthia Lummis and Kirsten Gillibrand introduced a bill seeking to regulate stablecoins on Wednesday, April 17. Meanwhile, Economic Secretary to the Treasury Bim Afolami said the UK government is “working at pace” to deliver its own anticipated crypto bill before parliament breaks for the Summer.

The US and UK’s accelerating crypto regulation efforts highlight a growing need for formal governance of this space.

Senate Hurdles to Crypto Regulation

The latest Senate stablecoin Bill isn’t the first time Lumis and Gillibrand have teamed up on crypto legislation.

Previously, the bipartisan duo introduced the Responsible Financial Innovation Act in 2022. In the wake of the FTX crisis, they then re-introduced it in 2023 with a number of amendments focused on consumer protection.

Despite having the backing of key industry players, the Lumis-Gillibrand crypto bill has failed to gain much support in the Senate, where Democrats like Elizabeth Warren and Sherod Brown take a hawkish stance on crypto.

Pro-Crypto Candidates Standing in November Elections

In November, Brown will face off against the pro-crypto businessman Bernie Moreno, who was recently selected as the G.O.P’s preferred candidate.

Commenting on the uphill battle her bill faces, Lumis said that Brown particularly “has been a tough nut to crack,” although he may be more amenable to the new stablecoin Bill.

However, as he prepares to fight for his third Senate term in an Ohio that is significantly more Republican than it was 6 years ago, Brown might not be around for much longer.

Another race that could tip the Senate in a more crypto-friendly direction is taking place in Massachusetts, where John Deaton is hoping to unseat Elizabeth Warren. (Although his chances of success are much lower than Moreno’s.)

Meanwhile, 2 House candidates in Texas and Alabama recently won their primary races after receiving a combined $3.7 million in financial support from Protect Progress – a Democratic Super PAC that has received donations from Coinbase and Ripple Labs.

Shomari Figures, who will be on the Democratic ticket in Alabama, has listed crypto regulation as one of his top priorities if elected. According to his campaign website , Figures hopes to “develop a framework that responsibly addresses regulatory concerns around cryptocurrency and encourage reasonable regulation to protect consumers, investors and our economy.”

Likewise, Julie Johnson won the Texas Democratic primary with a proactive stance on crypto regulation: “As a member of Congress, I will work to make sure the United States has regulatory frameworks in place that allow American values to define the future of the global financial system,” she has stated .

UK Government Targets Summer Deadline for New Crypto Bill

Speaking at the Innovate Finance Global Summit in London, Afolami said the government plans to deliver legislation for a regulatory regime covering stablecoins and crypto staking by June or July.

“Once it goes live, a whole host of crypto asset activities, including operating an exchange, taking custody of customers’ assets and other things will come within the regulatory perimeter for the first time,” he stated.

The anticipated bill follows on from the 2023 Financial Services and Markets Act (FSMA), which laid the groundwork for further legislation by establishing legal definitions for crypto assets.

At the time, the FSMA didn’t face any real opposition during its passage through parliament. But if the government doesn’t introduce its follow-up crypto bill soon, it may lose its chance to shape UK crypto regulation to the next government. 

Crypto Regulation After the General Election

With a UK general election set to take place no later than 28 January 2025, recent opinion polling  gives Labour a 15–26 point lead over the Tories.

uk election polling
UK general election polling. Source: Wikipedia.

A future Labour government is unlikely to scrap a Bill the outline of which is generally agreed upon by parliamentarians. But setting the tone for UK crypto regulation might be too good of an opportunity to pass up if the Tories don’t move quickly enough.

Just as the looming general election places a question mark over the bill being prepared by Afolami and his colleagues, the outcome of November’s Congressional elections could also make or break the Lumis-Gillibrand stablecoin bill.

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