Stablecoin Issuers Lobby for Regulatory Framework

According to recent data, stablecoin issuers, including Tether, Circle, and others, have spent well over a million dollars lobbying on Capitol Hill since the beginning of 2022.

Washington has recently focused on stablecoins as pressure mounts to implement a regulatory framework for dollar-pegged digital assets.

Tether utilizes the law offices of Michael Jason Lee for its lobbying efforts, which are carried out by the bipartisan consulting firm FTI Government Affairs.

Since the beginning of 2022, Tether has spent approximately $600,000 on lobbying the U.S. Senate and House of Representatives, with quarterly expenditures of $120,000, according to ProPublica.

The lobbying efforts have supported stablecoin-related legislation. Tether issues the dominant stablecoin in the world, USDT, which has a 63% market share and $83 billion in circulation.

According to the government transparency organization Open Secrets, Tether spent an additional $270,000 on lobbying in the first quarter of 2023.

In the meantime, rival stablecoin issuer Circle has also invested heavily in lobbying. According to ProPublica, the company began lobbying with the strategic consulting firm Invariant in late 2021 and has spent at least $560,000 since then.

Circle’s lobbying efforts have focused on educating policymakers on its business model, educating members of Congress on stablecoin and cryptocurrency issues, and monitoring cryptocurrency-related legislative proposals.

The company has engaged in lobbying efforts with the Senate, the House of Representatives, the Treasury, the Office of the Comptroller of the Currency, the Commodity Futures Trading Commission, and the Securities and Exchange Commission.

Currently, Circle’s quarterly lobbying budget is $100,000. The company issues USDC, the second-largest stablecoin in the world, with a 22.6% market share and $29.5 billion in circulation.

The CEO of Circle, Jeremy Allaire, reaffirmed the need for stablecoin legislation and secure access to digital dollars on May 18.

Since early 2022, Paxos, the former issuer of the Binance stablecoin BUSD, has spent approximately $300,000 on lobbying.

Paxos employs the nonpartisan public policy firm Mindset for its lobbying efforts concerning the drafting of stablecoin legislation.

As reported earlier this year, crypto industry lobbying expenses in the United States grew by 120% in 2022.

However, the amount pledged by stablecoin issuers is dwarfed by the amount spent by other significant crypto companies.

Coinbase and Binance have spent approximately $5,500,000 on lobbying since 2015, when they first began. The United States spent nearly $1 million in 2022.