U.S. teachers' union urges Senate to "reject crypto market-structure bill"

The American Federation of Teachers (AFT) urged a halt to legislation submitted to the Senate on crypto market structure, saying it could undermine protections for pension and retiree assets. The union argued the bill could weaken traditional securities regulation and allow unregistered trading of tokenized shares.

On the 10th (local time), according to Decrypt, Randy Weingarten, president of the American Federation of Teachers (AFT), said in a letter to Senate leadership sent the previous day that the Responsible Financial Innovation Act "removes even the minimal protections for crypto assets and exposes the retirement assets of millions of households to serious risk." AFT is a national organization representing about 1.7 million teachers, college professors, nurses, and public-sector workers in the United States.

Weingarten said the bill is structured to circumvent existing federal securities regulations. He warned the bill could allow companies to tokenize shares and distribute them on blockchains without being subject to registration, reporting, and other existing rules. The letter, first reported by CNBC, was submitted amid faltering negotiations over the bill.

The Responsible Financial Innovation Act is a market-structure draft that allocates supervisory authority over digital assets between the SEC and the Commodity Futures Trading Commission (CFTC) and sets federal common standards for exchanges, brokers, custodians, and issuers. The Senate is coordinating with the goal of Senate Banking Committee review before year-end, but uncertainty is growing due to political and industry disagreements.

The mood at the Blockchain Association policy summit was also mixed. Some industry groups publicly split over DeFi regulation, access to peer-to-peer transaction data, and the scope of compromises. Several groups reportedly said, "It would be better if the bill failed," and announced they were withdrawing prior support.

The bill's prospects have weakened further due to changes in the political environment. Senator Cory Booker said that "the neutrality of regulatory agencies is being shaken as questions arise over whether the Supreme Court may allow the president to remove SEC and CFTC commissioners at will." Currently, Democratic seats at both agencies are vacant, and they are not expected to be filled at least until January next year.

Meanwhile, the Supreme Court will begin hearing this week on the legality of President Trump's removal of former Federal Trade Commission (FTC) commissioner Rebecca Slaughter. Slaughter's spouse, Justin Slaughter, is reported to be pushing the market-structure bill at Paradigm.