Revised text

Negotiators circulate revised text of Senate crypto bill

The new draft could represent a breakthrough in talks over the crypto bill.

Jasper Goodman

Senate negotiators are circulating a tentative draft agreement on landmark cryptocurrency legislation that could clear the way for a floor vote in the coming days, according to text of a revised draft obtained by POLITICO.

It remains unclear if all necessary sides support the new text, and it is expected to change further in the coming days. But the new draft could represent a breakthrough in talks over the crypto bill after Democrats rejected a previous version of the measure in a procedural vote on the Senate floor last week. The bill would create the first-ever U.S. regulatory framework for stablecoins, which are digital tokens that are pegged to the dollar.

An agreement on the new language, while not a final deal, could pave the way for some Democrats to vote for a procedural motion as soon as early next week that would tee up a subsequent vote on final passage. That could give negotiators more time to hammer out final changes to the text that senators could adopt as a substitute amendment on the floor.

Democratic negotiators will need to sell a potential deal to others in their caucus. A memo touting the changes obtained by POLITICO that was sent to Democratic offices Thursday said the party’s negotiators “won major victories on a range of critical issues” in the talks.

“We strengthened provisions on anti-money laundering, foreign issuers, national security safeguards, consumer protection, and measures to preserve the safety and soundness of our financial system,” the memo said. “The bill has made substantial bipartisan progress since introduction and especially in the last week, these changes from the Rule 14 version lay the foundation for a safer, more secure framework.”

It added that Democrats “have received assurances from” Republicans on “a few” outstanding issues that they hope to resolve. They include limitations on big tech firms issuing stablecoins, expanded prohibitions on interest-bearing stablecoins and “a broad savings clause guaranteeing the application of existing federal consumer protection laws, including but not limited to protections stemming from the Consumer Financial Protection Bureau and the Federal Trade Commission.”

Talks on the crypto bill have been led by a bipartisan group of negotiators that included Republican Sens. Bill Hagerty, Cynthia Lummis and Tim Scott and Democratic Sens. Kirsten Gillibrand, Angela Alsobrooks, Ruben Gallego and Mark Warner.

The bill needs support from some Democrats who have not been directly involved in the negotiations in order to clear a 60-vote threshold, and those members have cautioned that they need to review revised text before making any commitments. Despite the revisions, the bill is already facing opposition from some other Democrats. It does not include specific language targeting the Trump family’s crypto business ventures, which is a major concern for some on the left — including the Democratic leader on the Senate Banking Committee, Elizabeth Warren of Massachusetts.

Warren’s Banking Committee staff circulated a pair of memos on Thursday bashing the revised bill.

One document focused on the first family, saying the legislation will “Fuel Trump’s Crypto Corruption.” The legislation “does not include any provision to prevent Trump and the Trump family from raking in enormous amounts of money from their corrupt cryptocurrency schemes,” it said. The second memo poked holes in the new additions in the draft, saying that “many of the new changes are fig leaves for significant flaws that jeopardize consumer protection and national security.”

It also remains unclear if all Republicans are on board with the new language. Two GOP senators — Rand Paul of Kentucky and Josh Hawley of Missouri — voted against the measure on the floor last week.

If Paul and Hawley remain opposed, Republicans will need support from at least nine Democrats to advance the legislation.