Former U.S. Senator Pat Toomey, who played a pivotal role in advocating for crypto legislation before leaving office, has expressed skepticism about the prospects of such legislation making progress in the current Congress. Despite recent advancements in the House of Representatives, Toomey does not see a clear path forward for crypto regulation in the Senate.
While the cryptocurrency industry eagerly awaits regulatory clarity in the United States and continues to engage in legal battles with the Securities and Exchange Commission (SEC), congressional solutions appear to be on hold. Toomey shared his views during a Georgetown Law seminar on national security and digital assets, emphasizing that the much-anticipated congressional resolution is unlikely to materialize anytime soon. Even the fact that the House Financial Services Committee has passed several crypto bills for floor votes may not change the situation, according to Toomey.
Toomey remarked, “I don’t see a path forward in the Senate, regardless of how the vote goes in the House,” although he believes a bill focused on stablecoins might have the best chance. Crypto legislation typically needs to clear the Senate Banking Committee, a committee where Toomey held a prominent position as the top Republican. However, the current chairman of the Senate Banking Committee, Sen. Sherrod Brown, has not shown any signs of legislative action, even as other senators propose crypto-related bills and the House Financial Services Committee continues its own initiatives.
Sen. Brown has been critical of the potential consumer risks associated with cryptocurrencies, but he has refrained from endorsing or discussing any specific legislative responses. Faryar Shirzad, the chief policy officer at Coinbase Inc., considers this silence as a potentially positive sign. “He hasn’t committed at all on what to do,” Shirzad noted, suggesting that despite Brown’s criticisms, he has not dismissed the idea entirely.
Toomey, who currently serves on Coinbase’s global advisory council, believes there is hope for addressing one of the main challenges in stablecoin legislation: determining how the issuers should primarily be regulated, whether by the Federal Reserve or state agencies. Toomey indicated that an agreement with the Biden administration might be possible on this matter. However, he does not anticipate the stablecoin legislative effort to progress during this Congress.
In the next Congress, Toomey envisions a more favorable environment for crypto legislation, suggesting that progress may become more achievable once the White House is satisfied with the proposed regulatory framework.
As the crypto industry continues to navigate uncertain regulatory waters, the prospects for comprehensive legislation remain uncertain, with a shifting landscape in Congress and ongoing debates over regulatory authority and consumer protection.