Or impede the legislative process, SEC Democratic commissioner opposes stablecoin non-security characterization

The TD Cowen report notes that Caroline Crenshaw, Commissioner of the Securities Exchange Commission (SEC), opposes the designation of stablecoins as "non-securities", potentially creating a new obstacle to stablecoin legislation. Crenshaw criticized the SEC for underestimating the risks of stablecoins, saying the statement was deeply flawed in law and fact.
The SEC said last week that stablecoins that are backed by reserves and can be easily redeemed do not constitute securities. Crenshaw spoke out against this, stressing that intermediaries do not necessarily redeem dollars at a 1:1 ratio, posing risks to investors. Although both houses of Congress have advanced different versions of stablecoin regulations, differences within Crenshaw and the SEC could affect legislative consensus, especially at the Senate level, where Democratic support is crucial. In addition, Maxine Waters, the Democratic leader on the House Financial Services Committee, also expressed concern about former President Donald Trump's involvement in crypto policy, warning that legislation could pave the way for entrepreneurs such as Musk to issue stablecoins.