Lawmakers in the United States House of Representatives have reportedly collaborated to propose a bill to regulate stablecoin operations in the country. Accordingly, they have presented a bill to the Financial Services Committee (FSC), and other committee members have been receptive to this bill.
Lawmakers Make Moves To Regulate Stablecoin
According to various media outlets, two US legislators who are members of the Financial Services Committee of the House of Representatives recently proposed a bill to regulate stablecoin in the country. The lawmakers took the initiative to suggest a bill to ensure stability in the stablecoin market following recent events in the industry.
However, reports suggest that the Republicans are proposing an alternative approach, suggesting state-level regulations for stablecoins. Still, this development is not expected to hinder the progress of the bill proposed by the FSC.
Despite the political rivalry between the two parties, the Republicans and the Democrats have found common ground in their bid to ensure comprehensive guidelines for the stablecoin market. More importantly, the lawmakers agreed on one vital aspect – the need to avoid triggering a detrimental “race to the bottom” in establishing protective measures for fiat-backed digital currencies.
It is worth noting that the Democrats and Republicans were previously divided on the outcome of the proposed stablecoin legislation. However, this bill aims to establish a comprehensive regulatory framework for stablecoins and crypto trading entities within the United States.
The Committee’s move signals a landmark step in shaping the future of digital assets in the country. In a virtual gathering organized by the Washington-based think tank, the Atlantic Council, the Republican representative for Arkansas, James French Hill, suggested another proposal.
Hill revealed that one of the party’s objectives is to create an established pathway for US states to regulate stablecoin within their jurisdiction. However, Hill also acknowledged the need for prudent and well-balanced measures involving all stakeholders.
While making his remarks, the lawmaker mentioned that his colleagues from across the political divide are willing to support the move.
US Federal Reserve To Oversee Draft Stablecoin Bill
In a related development, Jerome Powell, the Federal Reserve chair, recently appeared before the US Congress. During his appearance, he emphasized the significance of the central bank’s involvement in overseeing payment tokens such as stablecoins.
Joining the discussion, Representative Jim Himes from Connecticut, a Democrat member of the Financial Services Committee, echoed Powell’s sentiment. Despite acknowledging the ongoing disagreement between state and federal policies regarding stablecoin regulations, Himes expressed optimism that these deliberations would not obstruct the successful passage of the proposed bill into law.
Lawmakers from both parties hope that the regulatory frameworks for crypto assets and stablecoin will be implemented before the end of the month. Furthermore, the House Financial Services Committee has rescheduled the date for the final vote on stablecoin and crypto regulations.
According to a scheduling note sent to members, the Committee will vote and deliberate on the mentioned legislation on July 26. Should the bill successfully scale through the House Financial Services Committee vote next week, the House of Reps will pass it to the Senate, requiring approval from the Democrats to advance further.
Even if the Democrats approve the bill, the Biden administration must give it final approval before it becomes law. Meanwhile, the proposed legislative piece is set to empower the Commodity Futures Trading Commission (CFTC) to gain more regulatory authority over crypto assets instead of the US Securities Exchange Commission (SEC).
Observers believe this bill can completely transform the US cryptocurrency industry’s current regulatory landscape. This shift in oversight responsibilities could lead to substantial changes in oversight functions regarding cryptocurrencies and other digital assets.