Ripple’s Brad Garlinghouse addresses Treasury’s Bessent and calls for clear crypto and stablecoin regulation

Ripple CEO Brad Garlinghouse has called for urgent legislative clarity around digital assets and stablecoins in the United States. This comes in response to US Treasury Secretary Scott Bessent’s comments on the stalled progress of the GENIUS Act in the Senate. The proposed bill failed to pass a Senate vote late Thursday after several Democrats who had supported it earlier defected.

In a May 9 X post, Garlinghouse asked lawmakers to help the US to “catch up” in crypto regulation. “Stablecoins are exploding globally for their real-world applications,” he wrote. “The sooner that the US can pass workable, clear rules, the faster it reaps the benefits of this technology.“

His post was a direct reply to a message from Bessent, who was disappointed after the Senate failed to advance the GENIUS Act.

“For stablecoins and other digital assets to thrive globally, the world needs American leadership. The Senate missed an opportunity… Senators who voted to stonewall US ingenuity today face a simple choice: Either step up and lead or watch digital asset innovation move offshore,” the Treasury Secretary beckoned.

Setback in the Senate over GENIUS Act

On Thursday, the Senate failed to pass a procedural vote that would have moved the GENIUS Act closer to becoming law. The vote, which required support to end debate and advance the legislation, faltered when several pro-crypto Democrats unexpectedly opposed cloture. 

Among them were Ruben Gallego (D-AZ), Mark Warner (D-VA), Lisa Blunt Rochester (D-PA), Andy Kim (D-NJ), Kirsten Gillibrand (D-NY), and Angela Alsobrooks (D-MD). Both Gillibrand and Alsobrooks were originally co-sponsors of the bill.

“While we’ve made meaningful progress on the GENIUS Act, the work is not yet complete, and I simply cannot in good conscience ask my colleagues to vote for this legislation when the text isn’t yet finished,” Senator Warner explained.

Without a federal framework, stablecoins remain under a patchwork of state-level rules that pro-crypto enthusiasts say stifle innovation and America’s competitiveness.

In response to Garlinghouse’s post, one X user surmised, “They will pass the law. They need a larger vehicle to stuff the national debt into. Stablecoins are that vehicle. They will continue to dollarize the world with stablecoins.”

Ripple sees end to legal battle with SEC

CEO Garlinghouse’s call for regulatory clarity comes against the backdrop of news that Ripple’s legal battle with the US Securities and Exchange Commission could come to an end. In a joint court filing on Thursday, Ripple Labs and the SEC requested a federal judge in Manhattan to dissolve an existing injunction and settle financial penalties totaling over $125 million.

According to the agreement, $50 million would be paid to the SEC, while the remaining $75 million would be returned to Ripple. The SEC stated that the decision “rests on its judgment that such resolution will facilitate the commission’s ongoing efforts to reform and renew its regulatory approach to the crypto industry.” 

In August 2023, Torres ordered Ripple to pay $125 million, substantially less than the amount originally pursued by the SEC.

Commissioner Caroline Crenshaw opposed the agreement, saying that it weakens courts in interpreting securities law. “This settlement, alongside the programmatic disassembly of the SEC’s crypto enforcement program, does a tremendous disservice to the investing public,” Crenshaw stated.

The Trump administration has made clear its intentions to end what it calls “regulation by enforcement” for crypto. Since Trump’s inauguration, the SEC has either dropped or suspended several high-profile lawsuits, including those against Coinbase Global Inc. and Binance Holdings Ltd.

Meanwhile, Ripple’s XRP token is in an ongoing market consolidation. The token is currently trading around $2.14, according to CoinGecko updates. Technical analysts note that XRP is stuck within a falling wedge pattern, with the 21-day moving average acting as an upper resistance.

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