Teachers' Union Demands Senate Halt Crypto Bill to Protect $39 Trillion Retirement Market

Source: CoinEdition Original Title: Teachers’ Union Demands Senate Halt Crypto Bill to Protect $39 Trillion Retirement Market Original Link: The American Federation of Teachers (AFT) is pressing the Senate Banking Committee to halt momentum behind its new crypto market structure proposal, warning that the measure could introduce major vulnerabilities into retirement portfolios nationwide.

In a detailed letter sent to Chairman Tim Scott and Ranking Member Elizabeth Warren, the union’s president, Randi Weingarten, argued that the bill dismantles existing investor protections surrounding both digital assets and conventional securities, which could expose pensions and 401(k) accounts to greater instability.

Union Flags Risks to Pensions and Securities Oversight

Weingarten wrote that AFT, which represents 1.8 million members, opposes the legislation due to what it describes as “profound risks” to working families’ retirement plans. She stated that recent drafts circulating within the committee “strip the few safeguards that exist for crypto” and dilute long-standing investor protections embedded in traditional securities law.

One of the key concerns highlighted by the union is a provision that would allow non-crypto corporations to place their stock directly on blockchain rails. According to AFT, this approach enables issuers to convert assets into tokenized formats while circumventing current regulatory controls. The letter warns that such a loophole could result in retirement accounts holding instruments that appear conventional on the surface but fall outside established oversight.

Tokenization Debate Intensifies as Senate Bill Advances

Tokenization of financial assets has become a key point as senators negotiate the final contours of the bill, co-sponsored by Cynthia Lummis, Bernie Moreno, and Chairman Scott. While the measure builds on legislation passed by the House earlier this year, Senate backers must secure at least seven Democratic votes for approval. Lawmakers have been meeting privately in recent days to discuss revisions, with senators, including Mark Warner, reviewing counterproposals.

States have also raised objections. Massachusetts Secretary of State William Galvin cautioned the committee that broad preemption of state laws would leave residents with limited protections against fraud.

Concerns Expand Beyond Labor Unions

The AFL-CIO previously signaled its opposition to an early draft, and major bank executives, including those from Bank of America, Citi, and Wells Fargo, are expected to meet with senators this week as discussions continue.

In addition, Senator Lummis told attendees at a Washington policy summit that she aims to circulate a revised draft by the end of the week before the committee proceeds to markup.