WASHINGTON—As many had expected, Sen. Roger Marshall (R-KS) filed an amendment on Tuesday night seeking to attach the credit union-opposed Credit Union Competition Act to the GENIUS Act, which was passed earlier by the Senate.
The Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act seeks to regulate stablecoins–which are pegged to a currency, in this case the U.S. dollar–and has the backing of the crypto industry and the Trump Administration.
That Credit Union Competition Act that is co-sponsored by Marshall and Sen. Dick Durbin (D-IL) has been introduced in several prior sessions of Congress and has ultimately not passed a vote, but just as strongly as financial institutions oppose it, the country’s retailers and business groups support it.
Proponents of the Credit Card Competition Act (CCCA) say it will increase competition in the credit card industry by requiring large banks (with assets over $100 billion) to allow credit card transactions to be processed on at least two unaffiliated networks, one of which must not be Visa or Mastercard. While only one credit union (Navy Federal) is above that asset size threshold, critics say it will for all practical purposes apply to all card issuers and will drive down interchange income without requiring retailers to do anything about risks from fraud.
‘Has No Place’
“This interchange language has no place in the GENIUS Act. It would drive up costs for Main Street America—consumers, small businesses and small financial institutions, including credit unions,” Jim Nussle, president and CEO of America’s Credit Unions said in a statement. “The disruption to the credit card payment system would negatively affect consumers’ access to needed credit and services they depend on. This amendment is a poison pill to the legislation, and we urge senators to oppose it as it would hurt hardworking Americans.”
Democratic Support Moves Bill
Earlier, after clearing a procedural hurdle, the Senate advanced the GENIUS Act after 16 Democrats backed the effort in a 66-32 vote following an agreement to add an amendment to the bill that addressed sticking points cited by the minority party. Those include new changes to consumer protection safeguards and limits on tech companies issuing stablecoins, as well as the extension of ethics standards to special government employees — which would temporarily apply to Elon Musk and tech entrepreneur David Sacks, according to NBC News.
Objections Raised to Insider Profits
Democrats have also raised objections to the Trump family’s crypto dealings with World Liberty Financial, an issuer of meme coins. But no provisions in the negotiated amendment would prohibit Trump and his family from continuing their crypto ventures, NBC News noted.
The bill text includes a provision that would “prohibit any member of Congress or senior executive branch official from issuing a payment stablecoin product during their terms in office.
“Basic flaws remain unaddressed,” Sen. Elizabeth Warren (D-MA), the top Democrat on the Banking Committee, said on the Senate floor. “Congress should not choose to enable the president’s egregious corruption.”
Not Before Memorial Day
Senate Majority Leader John Thune (R-SD) said he expects the Senate won’t vote on final passage before it leaves town for the Memorial Day recess.
A companion bill has been introduced in the House, but the language is somewhat different and it faces a tougher road, analysts have said.
The legislation is supported by the crypto industry, but other organizations, such as the Electronic Payments Coalition, are deeply opposed to portions of the bill, as will be financial trade groups should the CCCA be included.
