Teachers Union Demands Senate Kill Crypto Market Structure Bill, Citing ’Profound’ Pension Risks

Teachers' unions just fired a warning shot across the bow of Capitol Hill—and they're aiming at crypto legislation.

In a move that pits traditional pension guardians against digital asset innovation, a major educators' union is demanding senators scrap a pending crypto market structure bill. Their argument? The proposed regulations don't just fail to protect retirement funds—they allegedly expose them to 'profound' and unacceptable risk.

The Core Conflict: Fiduciary Duty vs. Financial Frontier

This isn't about being anti-technology. Union representatives frame it as a fundamental clash of priorities. Pension managers operate under a strict fiduciary duty—a legal obligation to prioritize the financial security of retirees above all else. The union's stance suggests the current bill's framework is seen as too permissive, potentially opening the door for pension portfolios to venture into what they deem a dangerously volatile asset class without sufficient guardrails.

Their fear is clear: the bill might create a pathway for pension funds to allocate capital to crypto markets, tying the retirement futures of public servants to the wild price swings of digital assets. For them, that's a gamble with teachers' life savings, not a strategic diversification play.

A Political Stalemate in the Making?

The demand throws a wrench into the already complex machinery of crypto legislation. Proponents of the bill argue that clear market structure rules are precisely what's needed to bring stability, institutional confidence, and, yes, safer avenues for large-scale investment. They see the union's opposition as a misunderstanding—a fear of the unknown stifling necessary progress.

But the teachers' lobby carries significant political weight. Their opposition could rally other public pension funds and labor groups, creating a formidable bloc against the bill's passage. It transforms the debate from a purely financial tech issue into one about social responsibility and the protection of public sector workers.

The Bottom Line: Trust, or the Lack Thereof

At its heart, this clash is about trust. The crypto industry has spent years asking for a seat at the table, promising a new financial paradigm. The teachers' union response, in essence, is: 'Show us the adult supervision first.' They want ironclad consumer protections, unequivocal custody rules, and transparency measures that exceed current market norms before any pension dollar gets near a blockchain.

It's a stark reminder that for all the talk of decentralized finance, real-world adoption still requires convincing the very centralized, very risk-averse institutions that manage traditional wealth. And sometimes, those institutions are more concerned with a secure retirement than with the next shiny financial toy—a concept apparently as revolutionary as blockchain itself to some in finance.

The Senate now faces a tough choice: advance a bill that could define the U.S. crypto landscape for decades, or heed a powerful warning from those tasked with safeguarding the futures of millions. One side sees unchecked risk; the other sees missed opportunity. The only thing both might agree on is that the stakes are anything but virtual.

AFT said Crypto Market Bill Endangers Working Families’ Pensions

Weingarten wrote that the bill “poses profound risks to the pensions of working families,” arguing it would not provide the regulation or “commonsense guardrails” needed around crypto assets and stablecoins.

She said most pension systems do not hold crypto because of its volatility and unclear legal status and warned that the legislation treats digital assets as if they were established and stable financial products when they are not.

The union represents more than 1.8 million workers in education, healthcare, and public services, including many whose retirement income depends on state and local pension plans.

Its letter warned that the bill would allow companies with no connection to crypto to place their stock on a blockchain and avoid the registration, reporting, and oversight requirements that apply today.

According to the union, the shift would let issuers bypass registration rules and remove oversight of intermediaries that MOVE assets between buyers and sellers.

Weingarten said such a move would leave state and federal regulators with fewer tools to hold bad actors accountable, warning that pensions and 401(k) plans could end up holding assets that appear traditional but are not subject to the same standards.

Senate Rekindles Push to Define Crypto Regulatory Boundaries

The Responsible Financial Innovation Act is the Senate’s main effort to define which crypto assets fall under the jurisdiction of the CFTC and which belong under the SEC. It also aims to set federal rules for exchanges, brokers, custodians, and token issuers.

Supporters say the bill is needed to clarify a growing patchwork of crypto oversight, while critics argue it could break apart existing securities protections without replacing them with something equal in strength.

The debate comes as policymakers attempt to determine whether tokenized versions of traditional instruments can be traded under a revised federal structure and what that means for investors who rely on the security of established markets.

Work on the Senate bill had slowed in the months following the longest government shutdown in U.S. history, which created a backlog across financial regulatory agencies.

Trump signs bill ending 43-day shutdown. ETFs await approvals, and markets eye potential weekend momentum.#Shutdown #Bitcoinhttps://t.co/zzvrf2SqdN

Senate Staff Races to Finalize Draft as Holiday Deadline Nears

Several senators have said a new version could emerge before the year ends, though the timeline remains uncertain.

The political environment surrounding the bill has become increasingly tense. Senator Cory Booker warned this week that the legislation’s prospects were weakened after signs that the Supreme Court may soon allow President TRUMP to fire SEC and CFTC commissioners at will.

With no Democrats currently seated at either agency, and none expected until at least January, Booker said the absence of minority commissioners complicates any bill that depends on those regulators to implement its framework.

The CFTC is currently led by Acting Chair Caroline Pham, who has held the position since January after Rostin Behnam stepped down.

President Trump has nominated Michael Selig, a senior SEC attorney focused on cryptocurrency policy, to serve as the permanent chairman, though his confirmation remains pending before the Senate.

Despite the uncertainty, Senator Cynthia Lummis said she wants the Senate Banking Committee to move ahead with a markup of the market structure bill as early as next week.

@SenLummis says she wants a markup on the crypto market structure bill next week even as staff are “exhausted” from nonstop revisions. #Crypto #USPolicy #Lummishttps://t.co/RadNIvnWLp

She described staff across both parties as “exhausted” after multiple rounds of revisions and said she hopes to circulate a final draft before Congress leaves for the holidays.