A group of pro-cryptocurrency Democratic Senators has introduced an amendment to the GENIUS Act that is widely predicted to fail - intentionally.
This move appears designed to look like opposition while actually helping the stablecoin bill pass. This formal opposition will allow the Democratic Party to save face in a potentially unpopular move.
What is happening with the GENIUS Act?
The GENIUS Act, an important bill to regulate stablecoins, has caused controversy. Critics are concerned that it could facilitate corruption or destabilize the financial system. Despite these concerns, the bill maintains modest bipartisan support and is progressing in the Senate.
Recently, according to several reports, the Democratic Party introduced an amendment - the Cryptocurrency Corruption Termination Act - to allow the bill to proceed to a vote, even if the amendment fails.
This unusual strategy prevents the Democratic Party from using the filibuster procedure to block the GENIUS Act, overcoming an important legislative barrier.
In fact, this allows the Democratic Party to declare that they attempted to strengthen the bill without actually preventing its passage. A source called this move "Schumer 101."
This reference is based on Senate Majority Leader Chuck Schumer's previous use of similar procedural tactics to prevent government shutdowns.
"[The GENIUS Act] currently has many issues that need to be addressed. Although we very much want to continue working with our colleagues to resolve these issues, we will not be able to vote to end debate if the current version of the bill is brought to the floor," a joint statement from Democratic amendment supporters said.
Why this is important
This amendment is symbolic. It will not pass, but it provides cover for pro-cryptocurrency Democrats who do not want to publicly support the GENIUS Act. Additionally, it neutralizes the filibuster threat. A filibuster is a procedural tactic used in the US Senate to delay or block a vote on a bill or nomination. By introducing this amendment through an end-of-debate vote, the Democratic Party cannot subsequently use a filibuster to block the bill.
Most importantly, it ensures momentum. Even with some public opposition, the GENIUS Act can now reach a vote and is likely to pass.
Tensions over cryptocurrency policy have increased since the Trump administration supported pro-cryptocurrency regulations. Corruption allegations related to former President Trump and foreign cryptocurrency investments have deepened partisan divisions.
Recently, Representative Maxine Waters led a Democratic Party boycott of a hearing on cryptocurrency policy.
The vote on the final fate of the GENIUS Act will take place sometime in the next week, and a few Democrats still openly oppose it. Nothing is certain; disagreements among Republicans could change the outcome.
However, currently, its chances look very good. US stablecoin regulation may be on the verge of a major success.
