Overview

New York Attorney General Letitia James raised alarms about the U.S. Senate’s stablecoin bill, known as the GENIUS Act, warning Congress that the current draft fails to provide essential protections for Americans.

Key Points

• Letitia James has urged Congress to pause legislation relating to stablecoins, advocating for a balanced approach that nurtures innovation while safeguarding the banking system.
• She proposed strict regulations for stablecoin issuers, recommending these entities be treated like banks and mandating digital identity verification for users to bolster law enforcement efforts.

In a recent letter, she strongly criticized the GENIUS Act for lacking necessary protective measures, suggesting it should be adjusted to enhance U.S. control over dollar-pegged stablecoin issuers, which are vital as their presence grows within the financial system.

James emphasized the urgent need for legislative clarity and the enforcement of digital identity protocols to prevent misuse in areas such as sanctions evasion and money laundering.

Conclusion

James has been vocal about the potential dangers posed by the rapid growth of digital asset regulations, previously sharing her concerns about their unchecked expansion. As discussions continue in Congress regarding stablecoin legislation, her latest suggestions point toward an increasingly cautious regulatory approach.