The US House Of Representatives Introduces A New Stablecoin Bill Draft

Twitter icon  •  Published 11ヶ月前  •  Hassan Maishera

The United States House of Representatives has released a new bill draft that seeks to provide a comprehensive regulatory framework for stablecoins.

TL;DR 

  • The United States House Of Representatives has introduced a new bill that seeks to regulate stablecoins. 

  • The bill would see the Federal Reserve in charge of stablecoins in the country.

US Reps Working On A New Stablecoin Bill

Members of the U.S. House of Representatives are currently working on a comprehensive regulatory framework for stablecoins, like USDC and Tether. 

On Saturday, the House Financial Services Committee released a new discussion draft bill with no official notice on Saturday ahead of the topic hearing on Wednesday by the committee's new panel focused on digital assets and financial technology. 

While the draft is still in its early stages, the representatives are working on releasing a comprehensive bill and ensuring that talks and debate continue in Washing over the next few weeks and months. 

Talks of regulating stablecoins and the broader crypto market became intensified following the collapse of FTX in November 2022. 

Federal Reserve To Be In Charge Of Regulating Stablecoins

According to the draft, the US centra bank, the Federal Reserve, would be tasked with approving and regulating non-bank companies like Circle and Tether that currently issue or want to issue their own stablecoins in the country. 

However, credit unions and banks that desire to issue their stablecoins would be allowed to do so with approval from the main financial regulator they fall under, the National Credit Union Administration, Federal Deposit Insurance Corp. or Office of the Comptroller of the Currency.

The representatives want those who failed to register to face up to five years in prison and $1 million in fines. Furthermore, digital asset companies that desire to operate in the United States would need to register with the authorities, regardless of where the company is based. 

Furthermore, the bill seeks to introduce a two-year ban on stablecoins that aren't backed by a hard asset. In addition to that, banking regulators and the National Institute of Standards and Technology would have the power to set standards for interoperability between stablecoins to allow for ease of use. 

If the bill is passed, Congress and the president would direct the Federal Reserve to study the effects of a digital dollar (CBDC). This doesn’t come as a surprise, as the Fed has already studying whether to issue a digital dollar.

 

Author

Hassan Maishera

Hassan is a Nigeria-based financial content creator that has invested in many different blockchain projects, including Bitcoin, Ether, Stellar Lumens, Cardano, VeChain and Solana. He currently works as a financial markets and cryptocurrency writer and has contributed to a large number of the leading FX, stock and cryptocurrency blogs in the world.