Trump promises legislation on cryptocurrencies after resolving deadlocks in the Senate

At the World Economic Forum in Davos, President Donald Trump reaffirmed the US commitment to becoming the “cryptocurrency capital of the world.” However, behind this optimistic statement, a more complex reality emerges: the approval of comprehensive cryptocurrency legislation still faces significant obstacles that need to be addressed before moving forward.

The points of disagreement that need to be addressed

The main controversy revolves around stablecoin rewards, creating a clear divide between the traditional banking sector and the cryptocurrency industry. The GENIUS law, passed in the summer, prohibits stablecoin issuers from paying direct interest to holders. However, it allows third-party platforms, such as Coinbase, to offer these rewards.

Banks argue that this loophole could drain deposits from the community banking sector, while crypto companies accuse the traditional financial sector of trying to stifle competition. This deadlock reveals a fundamental tension: how to regulate innovation without harming the existing financial system? This issue is at the core of what still needs to be amended in the legislative proposal.

Accelerated timeline for approval: what to expect

The Senate Agriculture Committee scheduled a hearing to amend and vote on its version of the bill. The legislative text was released the week after the events in Davos, signaling that Congress is moving quickly in its discussions.

Coinbase recently withdrew its support, causing instability, but the pro-crypto administration maintains internal pressure. David Sacks, White House AI and Crypto Czar, emphasized the need for commitment so that the legislation reaches the president’s desk before the momentum dissipates.

Industry support pushes for legislative progress

Brad Garlinghouse, CEO of Ripple, advocated for swift approval, emphasizing that although no legislation is perfect, a clear regulatory framework is essential for innovation to flourish. Industry leaders and White House officials warn of the risk of losing political momentum if voting is delayed.

Passing this legislation is not just a regulatory milestone but a test of how the Trump administration can reconcile the fundamental disagreements between the traditional and innovative sectors of the financial industry. Next week will be critical in determining whether these deadlocks can be resolved or if new proposals will need to be amended again.