What to know:
- A procedural vote to advance stablecoin legislation has failed in the Senate, meaning the process for getting that bill to a debate and vote could be further delayed.
- The 48 votes to move the bill to the next stage were well short of the 60 needed, which supporters of the effort thought they'd easily get after months of bipartisan work.
- Two Republicans voted against the bill, too.
The U.S. legislation that would establish stablecoin regulation failed to take a huge step closer to reality on Thursday as a rush of Democratic resistance kept the bill from moving into a debate phase, which would have been the path toward an eventual vote on passage
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The crypto industry has been closely watching the Senate, where the fate of its long-fought legislative battle hangs in the balance this year. The first of two major digital assets bills — this one to regulate stablecoins such as Circle's USDC and Tether's USDT — ran into a congressional roadblock, despite having easily won bipartisan approval in a previous Senate Banking Committee vote.
A technical but vital vote to advance the legislation into days of floor debate next week, failed 48-49. Under Senate rules, 60 votes were needed to advance to a maximum period of 30 hours of floor debate. Senators Josh Hawley and Rand Paul broke ranks with their fellow Republicans to vote against advancing the legislation. Senate Majority Leader John Thune flipped his vote to no as well at the end of the vote series in a procedural move to bring the legislation back at a future date.
The 60-vote threshold to get to the next stage is the greatest point of leverage for critics of the current legislative language. Once a bill advances, a simple Senate majority can pass it, meaning Republicans could theoretically do it on their own if they marshal all their members.
Some Democrats who had previously spoken in favor of the effort turned against it in recent days, saying the stablecoin regime needed more safeguards against illicit behavior, most notably singling out the crypto business ties of President Donald Trump as a potential conflict of interest that was flagged by many of them as corruption.
Senator Ruben Gallego, who received $10 million in backing from the crypto industry's political action committees during the 2024 election, was among them, and he said on the Senate floor before the vote, "I believe there is a pathway for us to actually get this done, get good language, have a bipartisan win for this country."But he said the hard work and "good faith" that's gone into the bill so far should be paused.