Elizabeth Warren Cheering For Tougher Sanctions On Stablecoins In The U.S
The senator pushes for new sanctions authority within stablecoin legislation, but the Lummis-Gillibrand bill falls short of her expectations.
Senator Elizabeth Warren has written to Treasury Secretary Janet Yellen, echoing concerns raised during Deputy Treasury Secretary Wally Adeyemo’s April 9 testimony before the Senate Banking Committee. Her focus remains on Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) efforts.
Warren’s letter to Yellen emphasizes the need for comprehensive AML/CFT measures for stablecoins, aligning with Adeyemo’s Senate testimony. The Treasury’s proposed sanctions expansion to include blockchain validator node operators is part of its broader enforcement strategy, outlined in a document Warren references as a “letter to Congress” dated November 2023.
Those authorities must be adopted into any legislation Congress advances to create a new regulatory framework around the $157 billion stablecoin market.
Warren’s reference didn’t pertain to the stablecoin bill introduced by Senators Kirsten Gillibrand and Cynthia Lummis on April 17, which notably lacks substantial mention of AML/CFT in its 179-page draft.
Instead, it appears Warren had her sights set on a forthcoming bill from House Finance Committee chair Patrick McHenry and ranking member Maxine Waters. Warren conveyed similar concerns in a letter to them on April 8. She wrapped up her correspondence to the treasury secretary by stating:
Stablecoin legislation […] must include the full suite of AML tools that Treasury requested in its November 2023 letter to Congress as necessary to effectively combat that threat [of terrorism financing.
Taylor Barr, Senior Policy Associate at the Digital Chamber, weighed in on X, potentially alluding to the Lummis-Gillibrand bill, noting, “It would be insightful to hear Sen. Warren’s perspective on the bill’s enhanced consumer protection, receivership provisions, or the enforcement authority of the Fed/OCC. These aspects seem conspicuously absent from her remarks…”
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