Democratic Senator Kirsten Gillibrand, who has been working with crypto-friendly Senator Cynthia Lummis to promote the Responsible Financial Innovation Act (RFIA), stated in an interview on April 8 that 2025 will be a major turning point for U.S. crypto legislation. After three years of revisions, the RFIA has finally entered congressional discussions, with the first wave of the bill focusing on stablecoins and market structure. Gillibrand bluntly warned that without legislation, another FTX-like disaster is inevitable.
Gillibrand Saw It Coming Three Years Ago and Has Been Deeply Involved in Drafting Crypto Legislation
Back in 2022, Gillibrand and Lummis jointly introduced a crypto legislative proposal, which initially attracted little attention. However, following the collapse of FTX and the rise in fraud, both Congress and regulators have started to take crypto regulation seriously.
She explained that she was motivated to get involved after seeing how cryptocurrency and blockchain technology could significantly enhance financial inclusion and data transparency, and could also be applied in fields like healthcare, identity verification, and AI.
Stablecoins Are the Easiest to Regulate, So Start There
Gillibrand emphasized that their bill is designed to be clear and approachable, aiming to break through congressional resistance with a straightforward regulatory framework:
- Every stablecoin must be backed 1:1 with U.S. dollar reserves
- Clear rules on who can issue stablecoins and what kind of oversight applies
- Transparency, safety, and accountability are mandatory
Gillibrand Has a Securities Law Background—Crypto Can Be Regulated
Gillibrand, a former securities attorney, dismissed claims that crypto cannot be regulated:
"Back in 2008, credit default swaps (CDS) were truly complex—but I understood them. Crypto is just a new type of asset, fundamentally similar to past financial products."
She pointed out that whether it's securities, banking, or commodities, the U.S. already has all the tools—it just needs legislation to catch up.
Without Legislation, Expect the Next FTX Collapse
Gillibrand believes FTX collapsed due to the absence of regulation—and it wasn’t even based in the U.S.
"If another similar collapse happens, countless American retail investors will suffer."
She also criticized some officials for adopting an "ostrich mentality"—pretending the problem doesn’t exist.
$40 Million Fraud in Kansas Underscores the Urgency
She cited a recent case where a state bank in Kansas was defrauded of $40 million by a foreign scam group using a fake crypto investment scheme.
While some funds were recovered through transaction records, she emphasized:
"Blockchain transparency is a strength. With proper regulation, that money never should have left."
Stablecoin Bills in Both Chambers Need Reconciliation
In the Senate, Gillibrand and Lummis introduced the Genius Act focused on stablecoins. Meanwhile, a similar bill is pending a vote in the House.
Gillibrand noted that while there are some differences between the two proposals, she hopes to consolidate them and incorporate agreed-upon stablecoin provisions into the broader market structure bill.
A Key Goal: Prevent Market Disruption by Chinese-Issued Stablecoins
Gillibrand stressed the need for U.S. legislation to ensure that:
"Any crypto asset sold or issued within the U.S.—even if it's from China—must follow the same rules."
She warned that allowing foreign adversaries to bypass U.S. regulations could enable them to use stablecoins for disruption.
Defining Assets: Security, Commodity, or Just a Joke?
Gillibrand revealed that determining asset classification is a key part of the legislation:
- Bitcoin (BTC), decentralized and without an issuing company: classified as a commodity
- Tokens closely tied to a company’s performance: initially securities
- Meme coins like TRUMP: treated as collectibles
She advocated for a multi-agency review process involving the Treasury, SEC, CFTC, and others to decide the classification of each crypto asset.
Warning Labels for Meme Coins Needed
Concerned about the explosion of meme coins, Gillibrand proposed that they should carry warning labels, similar to cigarette packs:
“It should clearly state to consumers: this has no real value—you could lose everything.”
Timing Is Right: 2025 Could See the First Comprehensive Crypto Law
Gillibrand emphasized that this is a rare moment where bipartisan consensus is possible in Congress. Multiple crypto bills have already passed committee reviews, and she expects the first comprehensive crypto law to pass by the end of 2025.
She also urged both the industry and the public to get involved:
“Even if you can’t speak to a lawmaker directly, explain your business and needs to their staff. Help them understand the industry.”
The Goal Is Not to Block Innovation—But to Make It Safer and Stronger
Gillibrand made her stance clear: the goal of legislation is to make the crypto industry safer, more reliable, and sustainable. She believes:
- The enormous potential of crypto technology should not be overshadowed by memes or scam coins
- Clear regulations are essential to protect retail investors from fraud
- Only with robust U.S. legislation can America become a trusted global financial leader
