After a wave of support and donations from the crypto industry swept Donald Trump and a group of pro-blockchain lawmakers into office, the Senate is expected to complete the first stage toward advancing a landmark bill that would create guardrails for stablecoins.

On Thursday, the Senate Banking Committee is scheduled to mark up the legislation, a process where lawmakers consider changes to a bill’s text, before moving forward to a full floor vote. Stablecoin legislation, which would regulate a type of crypto asset tied 1-to-1 with the U.S. dollar, has long been a priority for crypto-friendly lawmakers in both the House of Representatives and Senate.

But even as the bill seems likely to garner enough support to move to the House, critics are raising fears that the legislation could undermine the stability of the U.S. economy and grant new influence to Big Tech companies, including Elon Musk’s X . A memo written by staff for Senate Banking Committee ranking member Elizabeth Warren (D-Mass.), and obtained by Fortune, argues that the bill would facilitate illicit behavior such as sanctions evasion, as well as provide little protection for consumers’ funds.

Stablecoin momentum

Stablecoins have exploded in popularity over the past few years, buoyed by products like the dollar-pegged Tether, which has a market cap north of $140 billion. The sector has drawn the attention of venture capital investors and fintech companies, with the stablecoin startup Bridge attracting $58 million in funding from blue-chip firms including Sequoia before it was acquired last year by the payments giant Stripe for a whopping $1.1 billion.

Despite the growth of the sector, stablecoins remain unregulated at the federal level, with the crypto assets stuck in a gray area as agencies like the Federal Reserve and Office of the Comptroller of the Currency debate who should have jurisdiction. Congress has deliberated on bills that would regulate the technology, with the House Financial Services Committee working on a bipartisan effort since at least 2022. Chair Patrick McHenry (R-N.C.) advanced a bill out of the committee last year with some Democratic support, though it did not have the support of his former legislating partner, ranking member Maxine Waters (D-Calif.), and it did not reach a full floor vote.

After McHenry retired last term, pro-crypto lawmakers in both the House and Senate have repeatedly signaled that stablecoins would be the top legislative priority, with a market structure bill also in the works. The bill out of the Senate—called the GENIUS Act and sponsored by a bipartisan group including Sen. Bill Hagerty (R-Tenn.), Senate Banking chair Tim Scott (R-S.C), and Sen. Kirsten Gillibrand (D-N.Y.)—represents the first major vehicle to advance the legislation.

Key challenges include how to regulate foreign issuers such as Tether, which has a history of compliance issues, as well as how to balance federal and state oversight, with the new bill allowing larger issuers to remain under state supervision. Advocates have argued that facilitating the growth of dollar-backed stablecoins will strengthen the dollar abroad. “My legislation establishes a safe and pro-growth regulatory framework that will unleash innovation and advance the president’s mission to make America the world capital of crypto,” Hagerty said when releasing an initial draft in February.

While the bill will need to reach a 60-vote threshold to make it out of the Senate, it seems likely to garner bipartisan support, especially with Gillibrand signed on. Other Democrats who have expressed interest in its passage include Sen. Ruben Gallego (D-Ariz.), the ranking member on a new digital assets subcommittee on the Senate Banking Committee, and Sen. Angela Alsobrooks (D-Md.), a first-term member of the Senate Banking Committee who is a cosponsor of the GENIUS Act.

Warren, however, remains a powerful critic. In the memo, her staff argues that the bill would allow commercial entities such as Big Tech companies to issue their own currencies and “control our money,” especially as Elon Musk moves further into the payments space through his social media platform X. They also write that it would risk leaving stablecoins outside of consumer protection rules, especially as Musk’s group DOGE erodes the Consumer Financial Protection Bureau, and that the bill does not include adequate safeguards against money laundering and terrorist financing—a frequent critique about Tether.

But despite Warren’s opposition, the crypto industry has momentum on its side, especially as Trump continues to sign blockchain-related executive orders and agencies such as the Securities and Exchange Commission move to embrace the technology. “This bill represents a true bipartisan effort,” Gillibrand said in a statement released on Monday.