Sen. Bill Hagerty, R-Tenn., recently got the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act regulating stablecoin "hotlined" for a quicker Senate vote process, just as Democrats began raising both political and policy concerns about the legislation they previously supported.
"The GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins) creates a strong, forward-looking regulatory framework to modernize our payment systems and affirms the dominance of the U.S. dollar," Hagerty told Fox News Digital on Monday, estimating stablecoins in circulation to amount to $243 billion.
"I’m eager to see it passed soon to ensure digital asset innovation thrives in America, customers are protected, and foreign companies are held to the same standards," he said.
However, Hagerty was also critical of Democrats – some of whom splintered after originally supporting the legislation in March – while its Republican co-sponsors, Sens. Tim Scott of South Carolina and Cynthia Lummis of Wyoming, remain on board.
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"We cannot allow partisan games to derail the momentum we’ve seen over the past 3 months on this legislation. We have a choice here: move forward or underscore that digital asset and crypto legislation remains solely a Republican domain," Hagerty added.
A stablecoin is a type of cryptocurrency that tracks directly with a government-backed currency like the U.S. dollar, giving it more security and legitimacy and less volatility, proponents say.
After it was announced that a Trump-linked stablecoin was being adopted by an Emirati firm for a major investment in the firm Binance, Sen. Elizabeth Warren, D-Mass., sounded the alarm on the timing.
"A shady fund backed by a foreign government just announced it will make a $2 billion deal using Donald Trump’s stablecoins," Warren said in a statement.
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"[This is] legislation that will make it easier for the President and his family to line their own pockets."
However, Warren’s criticism was different from those of former supporters like Sen. Ruben Gallego, D-Ariz., who instead suggested his reconsideration was more rooted in the political process of considering the bill.
Gallego originally said that digital assets appear "here to stay" and that Congress must find bipartisan agreement on how to regulate them for consumer safety.
"While this bill is not perfect, we have made many improvements through our bipartisan committee work – including better protections for customers in the event of bankruptcy, addressing national security risks, and strengthening guardrails to preserve financial stability – and I believe it is a step in the right direction," he added at the time.
However, on Sunday, Gallego rejected claims his and others’ sudden change of heart was political – like Warren or others.
"This isn’t some reversal out of nowhere by Dems," he said. "The fact of the matter is, Dems, including me and my team, were trying to negotiate with the Republicans for weeks."
"It seems they want us to suck it up and vote for this bill without our input," he said.
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In a statement from Gallego and eight other Democrats, the bloc said they support a bipartisan regulatory framework but that their "open-mind[ed]" approach to working across the aisle did not result in their concerns being addressed.
The bill requires more debate on anti-money laundering, accountability and national security provisions, the lawmakers wrote.
Separately, Senate Minority Leader Charles Schumer, D-N.Y., warned Democrats against supporting the bill during a Thursday lunch against warming to the GENIUS Act, according to Politico.
Schumer’s office did not respond to a request for comment, but the events of the meeting were confirmed to Fox News Digital by a Republican source.
Additionally, Schumer previously supported adding stablecoin legislation to the 2024 reauthorization for Federal Aviation Administration funding, saying his goal "is this: I want to bring members on both sides of the aisle here in the Senate together ... so we can pass sensible legislation that helps the United States maintain its status as the most innovative country in the world."
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