Today, Congresswoman Maxine Waters (D-CA), the top Democrat on the House Financial Services Committee, took to the House floor to blast S. 1582, the Republicans’ so-called “GENIUS Act.” This bill lacks critical provisions to maintain the longstanding separation of banking and commerce, protect consumers, preserve our national security, promote financial stability, and importantly, fails to address glaring conflicts of interest raised by the actions of President Trump and his Administration.

“Two weeks ago, Republicans boasted about how they would provide billionaires with tax cuts they don’t need by stripping healthcare from 17 million Americans, shuttering hospitals across the country, and starving 12 million families, including millions of children. These billionaires are the same individuals who proudly gave millions of dollars to President Trump’s campaign, literally bought votes during the last election, and even sponsored Stalinist military parades to celebrate the President’s birthday.

No one should be surprised that these same Republicans’ next order of business is to validate, legitimize, and endorse the Trump family's corruption and efforts to sell the White House to the highest bidder.

S. 1582, the so-called ‘GENIUS Act,’ establishes a woefully deficient Federal framework for dollar-denominated payment stablecoins in the U.S. Stablecoins are a form of digitized private money. Unlike other types of crypto, these coins claim to always maintain their value, often one coin for one dollar. Nevertheless, that promise of stability is precisely what causes stablecoins to be subject to bank-like runs, where the public rushes to sell their stablecoins at the first whiff of instability, making a bit of bad news into a full-blown financial crisis.

It was for this reason that when I was Chairwoman of the Committee, I sought to create a federal framework to oversee these stablecoins and ensure that consumers are protected. I worked with the Biden Administration, and former Republican Chairman Patrick McHenry to craft legislation. We achieved that goal, and I posted that legislation earlier this year. We wanted to create a strong federal system to oversee this type of the crypto market that protected consumers, our national security, and financial stability.

Unfortunately, the election of Donald Trump ended those bipartisan efforts, and brought a significant new challenge to stablecoins—the Trump Family’s brazen corruption using crypto to sell access in exchange for official acts.

And it just so happens that stablecoins are one of the main vehicles Trump is using to make his corrupt crypto billions.

The Trump family crypto company, World Liberty Financial, launched a stablecoin called USDOne in April. And shortly thereafter, the Abu-Dhabi-backed investment firm, M-GX, bought $2 billion of Trump’s coin to make an investment in Binance, a company that had been under investigation for numerous legal violations. Trump and his family will make tens of millions of dollars just on that transaction alone from the interest earnings alone. That’s Abu-Dhabi’s money.

More concerningly, by passing this bill, Congress will be telling the world that Congress is ok with corruption, ok with foreign companies buying influence, and ok with criminals buying Trump coins to seek pardons and beneficial treatment.

Surely, each of you can see how this is a blatant conflict of interest, right?

Well, Democrats and the rest of America does as well. It is why I introduced the ‘Stop TRUMP in Crypto Act’ to ban the President, Vice President, and Members of Congress from crypto corruption.
If we do not ban elected officials in S. 1582, including the President or Vice President, from crypto corruption, each of us will be complicit.

And let me be clear on this point because there has been a lot of misinformation. This bill has a policy statement that elected officials like Members of Congress and Senators, as well as government officials cannot issue their own stablecoins. But do you know who Republicans did not ban? Now, get this straight, the President and the Vice President. They’re the only elected officials that can have a crypto business. Why are the Republicans protecting the President to make billions and billions more dollars. Don’t just take my word for it. Earlier this week Chairman Hill confirmed as much at the Rules Committee.

Anyone who says that the bill stops the President’s company from issuing stablecoins is not telling the truth.

And, yet, even if we adopted such a ban, the ‘GENIUS Act,’ sent over by the Senate and apparently unable to be amended, is still bad public policy.

S. 1582 creates the appearance of a federal framework for stablecoins, but it does not provide the Federal government with the full authority it needs to ensure all stablecoin issuers comply with the law. The bill also creates risks for consumers who will be stuck in a lengthy bankruptcy process if a stablecoin ever fails.

Additionally, it leaves the door open for foreign firms that present a major national security threat, including targets of sanctions, all to appease those in the Trump family’s inner circle, which has ties to those shady entities. Yes, I’m talking about Tether, the foreign stablecoin issuer that everyone knows has been used in terrorist financing, organized crime schemes, and other horrible acts, but which the Commerce Secretary has close ties with.

But, let me give you one more example of why this bill is just bad for America. The very heart of this bill is that stablecoins will in fact be stable because they will be backed one to one with solid, safe assets. But I invite anyone to read the bill. While some of the reserves are cash and short-term Treasury securities, this bill also allows for un-insured deposits. We already know how dangerous these deposits are. When Silicon Valley Bank failed, Circle, the largest stablecoin today had $3 billion locked up in uninsured deposits, and needed the federal government to rescue it. But that isn’t all. A stablecoin issuer is also permitted to hold Bitcoin as reserves. That’s because someone added language the bill late in the night that added new definitions and language to the bill. The language allows for a stablecoin issuer to use any money received under repurchase agreements backed by quote ‘a means of exchange currently authorized or adopted by a... foreign government.’ Do you know what Trump’s favorite strongman, the dictator of El Salvador, adopted as a legal currency...BITCOIN. So, this highly volatile cryptocurrency will now be eligible to be a reserve backing on your stablecoins. It is truly absurd, and dangerous, and will lead to consumers losing their money and the taxpayers being called on to bail out the financial system.

It is for all of these reasons that I submitted several amendments to this bill, none of which were made in order by Republicans because the President has rejected any conflict of interest language that binds him.

One interesting point is that even Chairman Hill himself inserted language at the end of the so-called ‘CLARITY Act’ that the House is separately considering this week, that actually amends the ‘GENIUS Act.’ You heard me right. Rather than amend the ‘GENIUS Act,’ which our own Chairman saw had problems, he put his changes at the end of the ‘CLARITY Act.’ You may be asking why he would do that. He could just offer his amendments to the ‘GENIUS Act.’

The reason is, House Republican leadership has given up our power, as the United States House of Representatives, to work the will of our Members on behalf of our constituents and make changes to any legislation that the Senate sends us. Instead, we are simply taking the language directly from the Senate with no amendments, even when the Chairman and other House Members know that this bill is flawed.

Unfortunately, because President Trump demanded the bill be passed without any changes, that’s what the Republican Congress will do.

One of Chairman Hill’s changes to the ‘GENIUS Act’ addresses a key concern I have had from the beginning, which is that Facebook and any other Big Tech company should not be allowed to issue their own stablecoin. That would violate a longstanding separation of banking and commerce in financial regulation, and our Chairman’s amended language would help close this loophole. Unfortunately, the ‘GENIUS Act’ allows Elon Musk’s X to issue its own stablecoin, and creates a pathway for Facebook to do the same.

For these reasons and many more, I strongly oppose this bill.”

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