A major U.S. labor federation American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) is warning that the Senate's draft crypto bill could put workers and the financial system at risk.
In a letter to the Senate Banking Committee, AFL-CIO Director of Government Affairs Jody Calemine said the Responsible Financial Innovation Act (RFIA) offers only "the facade of regulation" and would let the industry expand without sufficient safeguards.
"The 182-page Senate draft of the bill… would permit FDIC-insured banks to directly hold and trade crypto," the union wrote, arguing the move heightens systemic risk.
"This not only exposes banks to heightened risk of losses and failures, but it also puts the FDIC's taxpayer-backed Deposit Insurance Fund at greater risk," Calemine wrote in the letter.
Retirement security sits at the center of the union's critique. The AFL-CIO says the RFIA could pave the way for crypto in 401(k)s and pensions without adequate protections.
"Rather than insulating workers from the instability of crypto assets values, the Responsible Financial Innovation Act would increase workers' exposure," the letter said.
AFL-CIO warns of FDIC, 401(k) and pension exposure under RFIA
The union also flagged that tokenization rules could sidestep traditional securities protections.
Calemine framed the legislation as enabling issuers to "evade SEC regulation through tokenization," warning of a "shadow" market outside normal oversight.
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The RFIA, led by Sens. Cynthia Lummis and Kirsten Gillibrand, is under review as an alternative to the House's market-structure bill passed in July. Senate Republicans are pushing for a floor vote in November, but the draft would still need bipartisan support to clear the 60-vote threshold.
Related: What is tokenization? Explained
This story was originally reported by TheStreet on Oct 8, 2025, where it first appeared in the Banking section. Add TheStreet as a Preferred Source by clicking here.
