tl;dr
Maxine Waters, representative for California’s 43rd Congressional District, introduced a discussion draft for a bill aiming to regulate stablecoin issuers in the US. The bill outlines a regulatory framework for payment stablecoin issuers, including licensing criteria and the Federal Reserve’s superv...
Maxine Waters introduces discussion draft for stablecoin regulation
Maxine Waters, representative for California’s 43rd Congressional District, introduced a discussion draft for a bill aiming to regulate stablecoin issuers in the US. The bill outlines a regulatory framework for payment stablecoin issuers, including licensing criteria and the Federal Reserve’s supervisory role. It mandates backing stablecoins with reserves and imposes penalties for unauthorized issuance. The bill also emphasizes consumer protection, prohibits non-financial companies from owning stablecoin issuers, and enforces compliance with anti-money laundering laws. The Federal Reserve would have enforcement authority, while existing regulators maintain oversight.
The bill is a bipartisan effort and follows the introduction of similar bills by Republican representatives and in the Senate. Additionally, the CFTC announced a CEO Forum to discuss stablecoin regulations.
Proposed bill outlines licensing and regulatory framework for stablecoin issuers
The proposed bill outlines a licensing and regulatory framework for payment stablecoin issuers. It details the criteria for both nonbank and bank issuers. A central feature is the Federal Reserve’s role in supervising stablecoin issuers. This ensures strict compliance with the proposed regulations. The bill mandates that stablecoin issuers back their coins one-to-one with reserves. This includes US currency, insured deposits, short-term Treasury bills, or repurchase agreements backed by Treasury securities.
It also prohibits any unauthorized individual or entity from issuing a payment stablecoin in the US. Violators would face significant penalties.
Bipartisan effort underway for stablecoin regulation
This bill is crafted with input from both Republican and Democratic congressional staff. Moreover, it is seen as a bipartisan effort to create a balanced, effective framework for stablecoin regulation.
Efforts to regulate stablecoins also underway in the Senate
Meanwhile, efforts to regulate stablecoins are also underway in the Senate. On February 4, Senator Bill Hagerty introduced the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act. Besides the bills, on February 7, CFTC Acting Chair Caroline Pham announced a CEO Forum with a key focus on stablecoin regulations.