coindesk.com
The U.S.’ second largest teacher’s union urged the Senate to reconsider a crypto bill it says puts 1.8 million members’ pensions at risk, while doing very little to fight fraud and corruption in the digital assets sector.
In a letter dated Dec. 8 obtained by CNBC, Randi Weingarten, president of American Federation of Teachers (AFT), addressed the U.S. Senate Banking Committee over the Responsible Financial Innovation Act, saying, “it poses profound risks to the pensions of working families and the overall stability of the economy”.
The proposal, which builds on a measure the House passed earlier this year, is co-sponsored by crypto ally Senator Cynthia Lummis and Senator Bernie Moreno , along with Senate Banking Committee Chair Tim Scott. While the bill lays out a framework for overseeing digital assets, it also raises fresh questions about how tokenized securities, instruments that aren’t strictly cryptocurrencies, would be treated by regulators.
“The legislation on crypto we have seen weighed by the committee over the last few months gives us deep concern,” Weingarten wrote. “It is as irresponsible as it is reckless. We believe that if enacted, this bill has the potential to lay the groundwork for the next financial crisis.
“Beyond the threat to the retirement security of working families, the legislation being considered by the committee does little to curb the illegal activity, fraud and corruption that continues to be prevalent in anonymous crypto markets,” he wrote.
In October, the AFL-CIO, the United States’ largest labor union, stated its opposition to the Senate Banking Committee over a draft of the crypto bill.
“The Responsible Financial Innovation Act does not protect consumers, workers or the financial system and instead exposes all to more risk,” said the AFL-CIO Director of Government Affairs Jody Calemine in the letter to the Senate Banking Committee. “Passing this legislation will allow the proliferation of assets that investors will wrongly perceive as safe.”
In July, Lummis said, “This discussion draft represents a thoughtful, balanced approach that will provide the clarity our innovators need while providing robust consumer protections.
Also a member of the banking committee discussing the bill, Senator Bill Hagerty agreed the bill provides the consumer guardrails Americans have long-awaited.
In August, the Institute of Internal Auditors also wrote a letter expressing concern, although in this case, in regards to crypto exchanges: “The IIA believes the draft legislation does not adequately address the critical need for sound governance and risk management processes at digital asset exchanges.”