Emre Yumlu 
The failure of the GENIUS Act, a stablecoin legislation introduced in the U.S. Senate, has reignited debates over political gridlock in Washington. Senate Banking Committee Chairman Tim Scott delivered a speech on May 8, placing the blame squarely on Democrats’ partisan maneuvering.
Scott: “Politics Took Priority Over Innovation”
Scott emphasized that the bill had gone through bipartisan negotiations and revisions before it was brought to a vote. However, according to him, Democrats withdrew their support at the last moment:
“This legislation was an opportunity to make the American economy safer and more affordable. But when the cameras came on, political calculations took over.”
Scott claimed that the last-minute opposition had nothing to do with the bill’s content, but was instead aimed at blocking a legislative win for former President Donald Trump:
“This vote was about stopping Trump. It was about preventing a victory in the digital asset space.”
Democrats Warn Against “Legitimizing Trump’s Crypto Interests”
Democrats pushed back strongly. Senator Elizabeth Warren raised alarms over the sudden rise of the USD1 stablecoin, which has alleged ties to the Trump family. She described the recent developments as a “suspicious crypto deal.”
“The Senate shouldn’t be passing legislation this week that facilitates this kind of corruption,” she said.
According to public data, USD1 was used by UAE-based investment firm MGX to fund a $2 billion investment in Binance on May 1. The stablecoin’s market cap skyrocketed from $137 million to over $2.1 billion within 24 hours.
Democrats Introduce Stricter Crypto Oversight
Beyond the GENIUS Act, Democrats are also ramping up efforts to regulate crypto-related conflicts of interest. New proposals such as the MEME Act and the End Crypto Corruption Act aim to prohibit federal officials from profiting off memecoins and stablecoins.
Senator Jeff Merkley highlighted the risks:
“If people can enrich the president by purchasing crypto he controls, that’s a pathway to corruption. It compromises national security and erodes public trust.”
Representative Maxine Waters was more direct in her criticism, stating:
“If no effort is made to prevent the President from owning a stablecoin business, I cannot in good conscience support this bill—and I urge others not to enable it.”
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