Stablecoin Bill Unveiled by US House to Provide Guidance and Strengthen Fed Oversight

The US House Financial Services Committee has recently unveiled a draft stablecoin bill, demonstrating a bipartisan effort between House Republicans and Democrats. The primary objective of the bill is to provide “clarity” in terms of the market structure of digital assets and the regulatory framework surrounding stablecoins. 

The bill will be further discussed and explored during the upcoming full Financial Services Committee hearing.

Will the US get much-needed clarity on digital assets?

The US House Financial Services Committee has scheduled a full committee hearing titled “The Future of Digital Assets: Providing Clarity for the Digital Asset Ecosystem” on June 13.

A third draft stablecoin bill has been released by the Financial Services Committee, which combines concepts from both the Republicans’ and Democrats’ financial services committees. The primary objective of this draft bill is to regulate the payment with stablecoins and address other related matters.

The bill defines the primary federal payment stablecoin regulators as the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the National Credit Union Administration.

Key provisions in the bill include regulations on payment stablecoin issuance and requirements, supervision and enforcement measures, qualifications for state-qualified payment stablecoin issuers, and interoperability considerations.

If the bill is enacted, it will impose a two-year moratorium, making it illegal to issue, create, or originate an endogenously collateralized stablecoin that does not exist on the date the Act is enacted.

An amendment to the Investment Advisers Act of 1940 will clarify that payment stablecoins are not considered “securities.” Additionally, federal agencies will have more authority and oversight over stablecoins compared to state regulators.

Chairman Patrick McHenry views this bill as an initial step towards regulating cryptocurrencies in the US. However, the stance of Democrats on the bill remains unclear. For the bill to become stablecoin regulation, it must pass both the US House and the US Senate.