[Congressional Record Volume 172, Number 36 (Tuesday, February 24, 2026)]
[Senate]
[Pages S653-S654]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
By Ms. WARREN (for herself, Mr. Merkley, Ms. Klobuchar, Ms.
Smith, Mr. Blumenthal, Ms. Duckworth, Mr. Durbin, Mr. Heinrich,
Ms. Hirono, Mr. Kaine, Mr. Kim, Mr. Markey, Mr. Murphy, Mr.
Schatz, Mr. Sanders, Mr. Schiff, Mr. Van Hollen, Mr. Welch, and
Mr. Booker):
S. 3904. A bill to amend the Internal Revenue Code of 1986 to deny
interest and depreciation deductions for certain taxpayers, and for
other purposes; to the Committee on Finance.
Mr. VAN HOLLEN. Mr. President, today, I am cosponsoring the American
Homeownership Act. When Wall Street buys up homes in communities across
the country, we have all too often seen families get squeezed by higher
costs and abusive landlords. This bill is an important step toward
making a home more affordable and accessible. It would limit tax breaks
for private equity firms and big corporations that acquire housing,
expand investments in affordable housing programs, and crack down on
companies that take control of the housing supply in a community.
As we work to tackle Wall Street's role in our housing market, it is
critical that we support efforts to rehabilitate existing housing stock
and revitalize neighborhoods with new investment. I appreciate Senator
Warren's thoughtful consideration of these issues, and I will work with
my colleagues to ensure they are effectively addressed in this
legislation.
By Mr. REED:
S. 3907. A bill to amend the GENIUS Act to require foreign payment
stablecoin issuers to undergo an annual audit similar to United States
payment stablecoin issuers, and for other purposes; to the Committee on
Banking, Housing, and Urban Affairs.
Mr. REED. Mr. President, today I am introducing the Foreign
Stablecoin Transparency Act. This important legislation would close a
loophole in the Guiding and Establishing National Innovation for U.S.
Stablecoins, or GENIUS, Act by extending a provision that requires
large U.S. stablecoin issuers to undergo a full financial statement
audit to also cover large foreign stablecoin issuers that offer and
sell their products to U.S. investors.
Stablecoins are cryptocurrencies whose value is pegged to a real-
world asset, which under the GENIUS Act is the U.S. dollar. The basic
promise that stablecoin issuers make to their holders is that a
stablecoin will always be redeemable for a dollar on demand. You give a
stablecoin company a dollar, the company gives you back an IOU that is
recorded on a blockchain. The stablecoin company takes your dollar and
invests it in various safe assets that are purportedly able to be
liquidated at any time to meet redemption requests.
All kinds of companies that handle the American peoples' money must
undergo financial statement audits. U.S.-based dollar stablecoin
issuers with $50 billion of stablecoins in circulation must get an
audit. Banks of all sizes must get audits, even the smallest community
banks. Many States require licensed money transmitters to submit
audited financial statements to provide transparency and verify their
financial health. Even unregistered private funds that are sponsored by
U.S. investment advisers must get audits. And of course, all public
companies must get audits. So it strikes me as entirely sensible to
extend this very same requirement to foreign issuers of dollar-backed
stablecoins, which handle Americans' money--just like so many other
institutions that are subject to audit requirements.
Unless stablecoin issuers are audited, there is no independent
verification that the company has enough assets to cover all
stablecoins in circulation. Instead, holders must take the word of the
issuer. If the issuer does not have sufficient reserves or is found to
be cooking the books, then a stablecoin company may experience a
``run'' on its assets and holders will not be able to get their money
back despite being sold something that they are told is safe and
redeemable on demand. That is why we need audits of all companies that
issue dollar-backed stablecoins to Americans.
A major flaw of the GENIUS Act is that stablecoins issued by
companies with headquarters outside the United States are not required
to undergo audits. Unless this flaw is addressed, the world's largest
dollar-backed stablecoin--Tether, which is based in El Salvador--can be
freely offered, sold, and used by Americans without being compelled to
provide a full accounting of the reserves backing its coin. Tether
purportedly has $187 billion in assets and is an essential piece of the
crypto financial system plumbing. All manner of crypto-assets are
bought and sold not with fiat currency, but with dollar-backed
stablecoins like Tether.
During his confirmation hearing before the Senate Commerce Committee
in 2025 Commerce Secretary Howard Lutnick testified, ``I believe U.S.
dollar-backed stablecoins should be fully audited.'' Earlier this week
before the Senate Appropriations Committee, I asked him whether this
specific statement included Tether, and he said ``I absolutely agree
with you, Tether should be audited.
Although Secretary Lutnick has no formal role in overseeing
cryptocurrency, he has significant experience in this area. His former
investment bank Cantor Fitzgerald has very deep ties to Tether. Cantor
owns a 5 percent stake in the company, manages the reserves backing its
stablecoin, and has cosponsored various crypto investment funds with
Tether.
My legislation would require foreign stablecoins backed by the U.S.
dollar like Tether to undergo an audit, no matter where the company is
located. And a full audit is essential. In 2021, Tether was fined by
the Commodity Futures Trading Commission for lying about its reserves.
The CFTC found
[[Page S654]]
that ``Tether misrepresented to customers and the market that Tether
maintained sufficient fiat reserves to back every USDt in circulation
`one-to-one' . . . and that Tether would undergo routine, professional
audits to demonstrate that it maintained `100% reserves at all times.'
In fact . . . Tether failed to maintain fiat currency reserves . . . to
back every USDt in circulation.'' Despite Tether executives promising
for years that they want to get an audit, we have yet to see them do
so. Instead, Tether has published quarterly ``attestations'' by the
Italian arm of a mid-tier accounting firm that simply verify
information that Tether provides to that firm using procedures that are
mutually agreed. That is very different than true independent third-
party verification based upon standardized procedures with criminal and
civil penalties if financial statements contain false information.
If foreign stablecoin issuers want the privilege of creating and
handling the American people's money, then I agree with Secretary
Lutnick that it is entirely sensible for them to open up their books
for the American people to see, just as we expect of large U.S.
stablecoin companies, banks, and other payments companies. If the goal
of the GENIUS bill is to create incentives for stablecoin issuers to
come onshore and operate fully within the U.S. regulatory perimeter,
then we must close this alarming gap that incentivizes dollar creation
by foreign companies.
I urge my colleagues to support this critical legislation.
____________________