American Federation Of Teachers Declares War On Crypto Market Structure Bill In Explosive New Letter

A major labor union just threw a regulatory wrench into the crypto industry's gears.

The American Federation of Teachers, representing over 1.7 million members, has publicly opposed a pivotal cryptocurrency market structure bill in a sharply worded letter to lawmakers. The move signals a significant new front in the battle over digital asset regulation, pitting institutional labor against an industry clamoring for clear rules.

Union Muscle vs. Crypto Hustle

The AFT's opposition isn't a quiet grumble—it's a formal, on-the-record stance that carries political weight. The union argues the proposed framework fails to provide adequate consumer and investor protections, potentially exposing its members and the public to undue risk in a volatile asset class.

This creates a fascinating clash: traditional, established institutional power aligning against an emerging financial sector's push for legitimacy. It's pension-fund caution meets decentralized finance ambition.

Why This Bill Matters

The legislation in question aims to create the first comprehensive U.S. regulatory structure for cryptocurrencies—a framework the industry has desperately sought to escape the current patchwork of state rules and regulatory uncertainty. Proponents argue it's essential for innovation and U.S. competitiveness.

The AFT's intervention threatens to slow or reshape that process, adding a powerful voice to the chorus calling for a heavier regulatory hand. It's a reminder that for all the talk of disruption, old-school political influence still runs the show in Washington—a truth as reliable as a banker's bonus.

The Ripple Effect

This isn't just a letter; it's a signal. Other large institutions and unions may now feel emboldened to voice similar concerns, creating a coalition that could stall the bill's progress. The crypto industry's lobbying efforts now face a formidable, organized counterweight with deep ties to the Democratic party.

The path to clear crypto regulation just got a lot more complicated. The industry wanted a rulebook, but it might have to contend with a teachers' union red pen first—proving that sometimes, the most disruptive technology still can't bypass a good old-fashioned political headache.

AFT Calls Out Loopholes In Crypto Legislation

In her correspondence with Senate Banking Committee Chairman Tim Scott and Ranking Member Elizabeth Warren, who is known for her consistent skepticism toward digital assets, Weingarten expressed significant concern about the implications of the proposed legislation. 

She stated that the current draft gives the AFT “deep concern” over the risks posed to retirement plans, including the union’s own pensions. Weingarten argued that advancing the crypto legislation could open the door to “widespread fraud” and “unethical practices” within retirement schemes.

Weingarten alleged that the bill “misleadingly” portrays cryptocurrencies as stable and mainstream, despite their volatility. She argued that rather than providing necessary safeguards. “If passed, it will undercut the safety of many assets and cause problems across retirement investments,” she noted.

Among the specific concerns raised by the AFT was a provision allowing non-crypto companies to issue their stock on the blockchain, thus evading existing regulatory frameworks for securities. 

Weingarten warned that this loophole and the corresponding erosion of traditional securities laws could have “disastrous outcomes.” She noted that pensions and 401(k) plans may end up invested in unsafe assets, even when they are nominally traditional securities. 

Additionally, she criticized the legislation for inadequately addressing the fraud and illegal activities that Weingarten believes remain prevalent in crypto markets, labeling it “irresponsible” and “reckless.”

Delays And Heightened Concerns

In the letter, Weingarten also stressed that if the bill were to become law, it could potentially set the stage for the next financial crisis. The AFT’s stance aligns with concerns previously expressed by the AFL-CIO, the nation’s largest labor union, which also opposed a draft of the crypto bill in October.

In line with Weingarten’s opposition, Democratic senators, including Warren, have raised concerns regarding the balance of regulatory oversight between the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC). 

Massachusetts Secretary of State William Galvin reiterated these concerns in a letter, highlighting that the proposed legislation could exclude significant portions of the financial industry from state oversight, creating risks for millions of savers.

Progress on the Senate’s version of the crypto market structure bill has faced delays, partly attributed to the recent lengthiest government shutdown in US history. 

Senator Lummis recently provided insight into potential timelines, indicating that her goal is to share a new draft by the end of the week. She plans to allow both the crypto industry and lawmakers from both parties to review the draft before moving forward with markup next week.

Featured image from DALL-E, chart from TradingView.com