The fate of long-awaited cryptocurrency legislation in the U.S. Congress was cast into doubt Tuesday, as a procedural vote to consider the measures was shot down by lawmakers from both parties, and shares of some companies in the sector fell.
House Republicans had billed this week as “Crypto week,” and were keen to advance numerous pieces of legislation aimed at providing clarity to the digital asset industry and long-sought legitimacy to the sector.
But those efforts hit an early snag on Tuesday, when several conservative Republicans joined with Democrats in blocking a procedural vote to allow consideration of three crypto bills as part of a dispute over how the measures should be packaged and considered.
Shortly after the vote, House Speaker Mike Johnson told reporters that he planned to continue discussing the matter with members and hoped to vote on it again shortly.
Shares of crypto-related stocks including Circle Internet and Coinbase Global dropped on the news but then pared losses. Circle Internet fell over 4 per cent while Coinbase was down 1.5 per cent.
The House was attempting to pass a series of crypto-related bills, most notably a bill that would establish a regulatory framework for stablecoins.
Stablecoins, a type of cryptocurrency designed to maintain a constant value, usually a 1:1 dollar peg, are commonly used by crypto traders to move funds between tokens. Their use has grown rapidly in recent years, and proponents say they could be used to send payments instantly.
That bill -- and another the House is considering that would define when a crypto token is a commodity -- would be a huge win for the crypto industry.
The House also was set to consider a bill that would prohibit the U.S. from issuing a central bank digital currency. Republicans say there is a risk this could give the government too much control over Americans’ personal finances.
That bill has not been considered in the Senate and the Federal Reserve has not indicated a desire to develop a central bank digital currency.
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Reporting by Chris Prentice and Caroline Valetkevitch; editing by Pete Schroeder and David Gregorio
