Patrick McHenry, the former Republican congressman from North Carolina and chair of the House Financial Services Committee, didn’t wait long to hang up his trademark bow tie and gavel for the private sector. After signing on as an advisor to fintech unicorn Stripe and venture giant Andreessen Horowitz, McHenry is announcing a third gig: vice chairman of the advisory board for Ondo Finance, a crypto firm focused on moving assets like U.S. Treasuries onto blockchains.
McHenry is famous in crypto circles for his work in Congress where he served two years as chair of the powerful House Financial Services Committee, and four more as ranking member. During that time, he advocated for legislation to supervise the emerging industry, including a bill to regulate stablecoins, the flagship product of Ondo. “This is the natural software update to financial markets,” said McHenry. “This feels like a no-brainer.”
“A huge opportunity”
Founded by a former Goldman banker, Ondo Finance operates in the red-hot field of tokenization—or put more simply, the process of issuing digital versions of assets like stocks or currencies on blockchains. Two of Ondo’s leading products, OUSG and USDY, essentially function as cash equivalents, though they differ from other popular stablecoins by offering yields to holders, similar to money market funds or savings accounts. They are also not pegged one-to-one to the dollar, with OUSG backed by short-term U.S. Treasuries.
While stablecoins have exploded in popularity, the lack of regulation in the U.S. has meant that issuers such as Ondo have been limited to offering yield only to institutional or overseas clients.
McHenry’s move to Ondo comes at a critical juncture for the sector. As chair, McHenry was on the verge of passing stablecoin legislation last year that would have created guardrails for the technology, voting a bill with bipartisan support out of his committee. Still, his former partner on the legislation, ranking member Maxine Waters (D-Calif.), opposed the bill in a controversial, last-minute decision, and it never reached a full floor vote.
McHenry says his work will be “making sure that Ondo is heard by the right people in Washington” and “helping shepherd them to new relationships.” That will undoubtedly mean nudging forward legislative conversations around stablecoins, as well as market structure—the subject of another bill that McHenry championed during his time in Congress.
Lawmakers have signaled that stablecoins are high on the agenda, and McHenry expressed optimism that a vote this time around could come with broader bipartisan support. “Ranking Member Waters is liberated from an administration that was not supportive of engagement,” he told Fortune. “They have a huge opportunity to get a stablecoin bill out of the House with a wide majority.”
Even as Washington becomes further entrenched in party politics, McHenry stressed that a “big bipartisan vote” would help unlock policy—a reality he experienced last session when several crypto bills, including his own market structure legislation, received wide support from House Democrats, though they were ultimately stymied. “Don’t fear the deal,” he said. “There is no great reward without great risk.”
Private sector pivot
With new roles at Stripe, a16z, and now Ondo, McHenry is firmly out of Congress—an institution he called home for 20 years. Still, having worked on legislation to supervise the industries of the companies he’s now working for, McHenry’s career pivot will inevitably conjure criticism of the revolving door.
“I am in the private sector now,” McHenry said. “Their agendas are broadly aligned with economic growth and economic opportunity, which is where I spent my time.”
While the three companies operate in the broader field of financial technology, they each focus on different sectors. Stripe has become a juggernaut in the payments space and is a perennial candidate to go public, with a valuation nearing $100 billion. Andreessen Horowitz—which counts McHenry’s former staffer Collin McCune as its head of government affairs—is a leading investor in both fintech and crypto startups. And Ondo straddles the worlds of traditional finance and crypto through its tokenized products.
“The through line is technology and innovation,” McHenry told Fortune. “Bolting on to great teams and learning from those teams.”
