What does this new US Bill mean for Stablecoins?

Yesterday. the US House Financial Services Committee released the first draft of a stablecoin bill for public comment. The 73-page bi-partisan bill, “to provide requirements for payment stablecoin issuers, research on a digital dollar, and for other purposes” is the first major cryptocurrency regulation proposed for the US this year.

What does the US stablecoin bill propose?

Interestingly, the new bill proposes a moratorium on stablecoins backed by other cryptocurrencies, from the date the act commences, until a study is conducted. Specifically, section 106 states that:

“During the 2-year period beginning on the date of enactment of this Act, it shall be unlawful to issue, create, or originate an endogenously stablecoin not in existence on the date of enactment of this Act.“

As well as this the bill notes that Federal stablecoin regulators will set capital, liquidity, and other standards for stablecoin issuers depending on the “complexity and risk profile” of the issuer.

The bill would also require the Federal Reserve Board, stablecoin regulators, and FinCEN to carry out a study on the impact of a US CBDC or “digital dollar”.

Read more perspectives on the Digital Dollar and CBDCS:

• The Potential Risks of CBDCs: Cato Institute Calls for Congress to Prohibit Digital Dollar
• Digital Dollar Project outlines principles for US CBDC
• Ted Cruz is the latest to say no to Digital Dollar

Reaction to US Stablecoin Bill

Circle CEO Jeremy Allaire said that the publication of the stablecoin bill is an “extraordinary moment for the future of the dollar in the world”, adding that it is “time for US leadership, and that means clear regulation and empowering entrepreneurship and innovation within the framework of US prudential law”.

See Also

Crypto CEOs Testify to U.S. House Financial Services Committee

A hearing regarding the bill will take place on Wednesday, April 19th. Witnesses at the hearing are listed as:

• The Honorable Adrienne A. Harris, Superintendent, New York State Department of Financial Services
• Mr. Dante Disparte, Chief Strategy Officer and Head of Global Policy, at Circle
• Mr. Austin Campbell, Adjunct Assistant Professor of Business, Columbia Business School
• Mr. Jake Chervinsky, Chief Policy Officer, the Blockchain Association