Government Stablecoin Payments Would Fuel 'Tax Evasion Economy,' Lawmaker Warns
At a House hearing on banking regulators, Rep. Brad Sherman attacked the idea of federal payments in stablecoins, saying it would enable tax evasion and create an alternative to the U.S. dollar. NCUA Chair Kyle Hauptman argued stablecoins could speed government payments, such as tax refunds on weekends and emergency aid, and said they could support dollar dominance by boosting demand for Treasuries. Sherman also warned regulators to close loopholes around any stablecoin yield. The hearing also became contentious over the Trump-linked World Liberty Financial’s bank charter bid, with Rep. Gregory Meeks accusing Comptroller Jonathan Gould of lacking independence. Gould rejected the criticism. Regulators said stablecoin oversight is advancing under the GENIUS Act, including planned customer-identification rules. Meanwhile, crypto firms continue gaining banking access: Falcon Finance launched a GENIUS-compliant stablecoin with Anchorage Digital, and Kraken received a limited Fed master account. The developments have intensified political fights over crypto banking approvals.
