Crypto legislation faces another hurdle: Labor unions

Jakub Porzycki | Nurphoto | Getty Images

The largest labor groups are urging senators to oppose a rules-of-the-road crypto bill scheduled to have an initial vote on Thursday.

In a letter and email first seen by CNBC, the AFL-CIO, as well as the Service Employees International Union, American Federation of Teachers, National Education Association, and the American Federation of State, County and Municipal Employees warned senators that the bill could jeopardize retirement accounts for millions of workers.

The push from unions comes ahead of the Senate Banking Committee’s vote on the crypto bill scheduled for Thursday. Despite Democrats working with Republicans on the bill over the last few months, it is not clear if any Democrats will back the measure given ongoing concerns about security and ethics provisions in the bill. As of Monday evening, the committee had yet to release final legislative text for the bill.

The SEIU, AFT, NEA and AFSCME said in the previously unreported letter sent to all senators on Friday that the bill “jeopardizes the stability of workers’ retirement plans, including public pensions, and introduces significant volatility to retirement savings accounts.”

“This legislation invites the cryptocurrency industry to take outsized risks, knowing that if those risky bets do not pay off, it is working people and retirees, not crypto billionaires, who will pay the price,” the groups said in the letter.

The AFL-CIO sent an email to Banking Committee members on Friday as well, saying that “absent sufficient regulation, embedding cryptocurrencies … and other digital assets into the real economy will have a destabilizing effect, while benefiting issuers and platforms at the expense of working people.”

Labor groups aren’t the only ones actively opposing the bill. The banking industry is also fighting a provision in the bill it says would threaten bank deposits by allowing crypto companies to offer payment on stablecoin holdings similar to interest. The crypto industry has pushed back, saying the proposed agreement would ban such practices.

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