Is Meta’s Stablecoin Dream Already Dead? Senate Moves In

Senate Quizzes Meta on Stablecoin Plans Meta’s dollar-pegged stablecoin plans are once again facing a new Washington wall, as senators from both parties ratcheted up the scrutiny amid heated debate over the GENIUS Act. The company’s new interest in digital assets — following public spectacular failure of its Libra (later Diem) project — has once again reignited Big Tech angst about the financial system, with lawmakers making a ”systemic risk” and privacy warning if Meta can be authorized to go after its stablecoin plans. At the eye of the storm is a letter penned by Senators Elizabeth Warren and Richard Blumenthal to Meta CEO Mark Zuckerberg. The senators demanded openness about Meta’s current work on stablecoins, any opposition to the GENIUS Act, and whether the company will battle amendments that bar Big Tech from owning or having relations with issuers of stablecoins. “Meta may be renewing its efforts to establish its own private currency, structured as a stablecoin.” — Senator Elizabeth Warren, June 2025 They referred to Meta’s troubled history with Libra/Diem and noted that the company might ”peel into consumers’ purchases and commercial activity” to fuel targeted advertising and data monetization programs. The GENIUS Act: New Roadblocks for Big Tech The GENIUS Act itself is a sweeping bill that seeks to provide regulatory clarity to stablecoins in the United States, requiring issuers to over-collateralize coins with liquid, secure assets and be federally or state-regulated. Recent amendments tacked on have sought to enhance consumer protection, bar misleading government-affiliated branding, and empower the Treasury Department with sweeping powers to suspend or revoke issuer registrations for failure to comply. Despite such safeguards, opponents like Warren argue the bill still leaves loopholes through which Meta and other major tech players can enter the stablecoin business — potentially destabilizing competition, jeopardizing financial stability, and undermining privacy. Meta itself has even gone on record saying it has no near-term plans to launch a new stablecoin. Communications director Andy Stone echoed on X: ”There is no Meta stablecoin.”. Nonetheless, there are ongoing reports Meta is negotiating with crypto infrastructure firms on stablecoin integration for cross-border settlements and creator payments, with preliminary-stage talks underway. The latest fintech purchase and platform launches by the company only fueled speculation that a stablecoin project—if not imminent—is at least being worked out in earnest for future regulatory windows. Political Climate and the Bill’s Prognosis Senators’ opposition outweighs Meta’s initiatives. They resonate broader alarms over the rise of Big Tech’s power in money markets, especially as the market for stablecoins balloons to more than $245 billion in market capitalization. Lawmakers worry that, in the absence of clear restrictions, the GENIUS Act would empower the tech behemoths to dominate electronic payments, harvest users’ data, and push out specialist fintech operators. There are Democrats who have demanded amendments to prevent stablecoins from being issued or controlled by large corporations outright, while some others advocate for stronger regulation and protection for consumers. Legislative supporters, Republicans and moderate Democrats alike, maintain the GENIUS Act’s robust reserve, audit, and transparency provisions will prevent the kinds of abuse that bedeviled earlier attempts such as Libra from recurring. Regulatory certainty, they argue, will at last allow responsible innovation and bring America into line with the rest of the world’s stablecoin markets. But with the Senate vote looming and partisan sparring intensifying, the bill’s final shape — and Meta’s stablecoin future—are very far from settled.

Source: Coinpaper