AFL-CIO opposes major crypto legislation
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The AFL-CIO, the nation's largest labor federation, addressed a letter to members of the Senate Banking Committee Monday night opposing the Senate's draft legislation to create a regulatory framework for the trading of digital assets.
The big picture: Citing the "volatility of the assets class," the labor giant says it worries about the retirement funds of its millions of members if cryptocurrency were to become more common in portfolios.
What they're saying: The group argues that the bill, the Responsible Financial Innovation Act, "provides the facade of regulation" that could cause cryptocurrency to become more mainstream in investment funds.
- "Passing this legislation will allow the proliferation of assets that investors will wrongly perceive as safe," Jody Calemine, AFL-CIO's director of government affairs, writes in the organization's legislative alert.
Context: The Responsible Financial Innovation Act is still just a discussion draft offered by leading pro-crypto Senators.
- It's one version of long-expected legislation known as market structure for digital assets.
Catch up fast: The AFL-CIO also opposed the Clarity Act, the House's version of market structure which passed that chamber in July with a bipartisan vote.
- Other inside-the-beltway groups have weighed in against updating crypto regulation, such as the coalition Americans for Financial Reform. Transparency International has warned that legislation along these lines don't do enough to stop money laundering. And Consumer Reports also opposed similar legislation in the House.
The other side: The legislative initiative also has its supporters, though primarily from groups aligned with the crypto industry. The Managed Fund Association also weighed in positively.
State of play: The aim for the Responsible Financial Innovation Act has been to have a Banking committee markup before the end of October.
- The Agriculture Committee has been promising a similar discussion draft, but it hasn't come out yet.
- The Senate also has the House-passed Clarity Act sitting before it.
What we're watching: Some kind of negotiation seems to be going on in the Senate, but not much is coming out about what the sticking points have been, and of course Congress is more busy arguing over the fact that the Federal government has shut down.
- The last thing we heard about was a framework from a group of Democrats, who wanted a bipartisan bill.
