Update (1405ET): CoinDesk's Margau Nijkerk reports that Top House Democrats sent a letter to the U.S. Treasury Department Wednesday, asking its money laundering watchdog to hand over all suspicious activity reports (SARs) tied to President Donald Trump’s crypto ventures.
In a letter sent to Treasury Secretary Scott Bessent, Reps. Gerald Connolly (D-Va.), Joe Morelle (D-N.Y.) and Jamie Raskin (D-Md.) - the ranking members of the House Oversight, Administrative, and Judiciary committees - called for an urgent investigation into Trump’s blockchain project World Liberty Financial and the $TRUMP memecoin, citing possible violations of campaign finance laws, bribery statutes and securities regulations.
“The Committees seek to determine whether legislation is necessary to prevent violations of campaign finance, consumer protection, bribery, securities fraud, and other anti-corruption laws in connection with fundraising by candidates for federal office and federal officeholders and to guard against deceptive and predatory campaign fundraising practices, illicit foreign influence over federal officials, and other financial misconduct connected to prospective or current federal officials,” the leading Democrats on the committees wrote in a press release shared with CoinDesk.
The request marks an escalation in congressional scrutiny on whether President Trump and his entourage are abusing their positions of power to benefit their crypto businesses. Senate Democrats pointed to Trump’s crypto ventures last week as part of their reason for not voting to advance stablecoin legislation that previously saw bipartisan support.
The inquiry zeroes in not only on the Trump family’s September 2024 launch of World Liberty Financial and the $TRUMP memecoin launched just days before his inauguration, but also Elon Musk’s America PAC and whether they are using Trump’s name to solicit donations under false pretenses.
As Sander Luz reported earlier via Decrypt.co, it was supposed to be a slam dunk.
The American crypto industry, flush with more political capital than it has ever had (and perhaps will ever have), was to get its long-awaited “regulatory clarity” on stablecoins last week.
And yet the Senate failed to pass a key procedural vote on the marquee stablecoin legislation.
As the bill, dubbed the GENIUS Act, languishes in legislative purgatory, should it be considered functionally dead—or might there be hope yet for its passage?
It depends who you ask.
Technically speaking, according to the Senate’s rules, the window to file a motion to reconsider the bill—which would establish a legal framework for offering stablecoins in the United States—has already passed.
Such a motion would have had to be filed by Monday evening, and no senators did so in time.
A source familiar with the Senate’s rules of procedure confirmed this state of affairs to Decrypt.
Stablecoins are a key component of the crypto economy. They are essentially digital dollar-equivalents that allow their users to enter and exit digital asset trades, and send payments or remittances overseas, without the need to access dollars directly.
It’s expected that once these assets are anointed by the U.S. Congress, rules of the road signed into law by President Donald Trump, banking giants and Wall Street titans will join the fray and enter the stablecoin market—bringing billions if not trillions of dollars into crypto. That’s why the lobbying arm of the crypto industry has been pushing so hard for this legislation.
But the GENIUS Act has not been taken up for a cloture vote this week because, functionally, political calculus has not changed on the topic since Thursday.
A small cadre of pro-crypto Democrats still have yet to reach a deal with Republican leadership over the bill’s language. Republicans are confident, however, they will be able to take advantage of “other procedural opportunities” to get the GENIUS Act back to the Senate floor if such a deal is made, sources told Decrypt.
After a largely uneventful weekend, key Democratic and Republican stakeholders are resuming talks this week over the contents of the bill, sources familiar with the plans told Decrypt. Both sides are remaining exceptionally tight-lipped, however, about what exact language is holding up progress.
Five Senate Democrats who voted against the bill last week previously voted to advance it from the Senate Banking Committee. Two of the Democrats who opposed the bill on Thursday, Kirsten Gillibrand (D-NY) and Angela Alsobrooks (D-MD), are consponsors of the legislation.
In a statement issued last weekend, pro-crypto Democrats blamed their withdrawal of support for GENIUS on portions of a new draft of the bill, which they said contained insufficient anti-money laundering and national security protections. But optics appear to also be playing a significant role in their change of tune.
In the last two weeks, President Donald Trump and his family have made multiple flashy crypto and stablecoin-related announcements that have animated Democrats over perceived conflicts of interest in the White House.
That line of attack has only been exacerbated since the weekend, with Trump announcing Monday that he intends to personally accept a $400 million Boeing jet as a gift from the Qatari government.
The Senate’s decision to block the GENIUS Act on Thursday drew immediate condemnation from Treasury Secretary Scott Bessent, who warned the vote could jeopardize the U.S.’s position in the global digital assets race.
“For stablecoins and other digital assets to thrive globally, the world needs American leadership,” Bessent posted on X.
“The Senate missed an opportunity to provide that leadership today by failing to advance the GENIUS Act.”
Multiple crypto policy leaders told Decrypt Tuesday they are growing increasingly worried that the political stakes involved pose a very real threat not just to any chance of salvaging the GENIUS Act, but also the rest of the industry’s legislative agenda.
A parallel stablecoin bill is currently making its way through the House, and foundational market structure legislation is pending in both chambers of Congress.
The policy leaders all agreed that this week is do or die for crypto’s political momentum in Washington.
Should the GENIUS Act fail to make significant progress by Friday—as in, pass the cloture vote it failed last week—the situation could become terminal, they warned.
“Grim if something doesn’t give soon,” one D.C. insider put it.
