US Senators Kirsten Gillibrand (D-NY) and Cynthia Lummis (R-WYO) will soon be introducing a new legislation in Senate that would offer two paths to stablecoin issuers.
Sen. Gillibrand Plans Stablecoin Legislation
The saga of crypto regulation in the US continues as another legislation for regulating stablecoins is waiting to be brought to the Senate. Democratic senator from New York, Kirsten Gillibrand, has revealed that negotiations are ongoing for a new stablecoin legislation, which could be introduced in the Senate at the end of the week or next week.
Speaking at the Bitcoin Policy Summit at the National Press Club in Washington on April 9, Senator Gillibrand said,
“We’re making sure that state and federal regulators have the oversight authority to weed out bad actors while still promoting growth and innovation. And we’re requiring that all issuers make sure that the reserves are back to one-to-one.”
Proposing Two Routes For Stablecoin Issuers
According to Senator Gillibrand, the new legislation was drafted by keeping in mind the original goal of adopting Bitcoin as a means of payment. The Senator believes that establishing regulatory framework for stablecoins will lay the foundation to unlock full potential of Bitcoin and other crypto assets.
The Federal Reserve, the Treasury Department, and the New York State Department of Financial Services have been involved in the drafting of the legislation, to provide two paths to stablecoin issuers.
Under the legislation, both federal and state bank charter depository institutions can get approved to become stablecoin isssuers. Furthermore, even non-depository institutions can issue stablecoins, provided they allow the federal government to supervise.
A Bipartisan Approach
Senator Gillibrand also acknowledged the need for more bipartisan perspectives and bicameral support for such legislation. Republican senator from Wyoming, Cynthia Lummis, who had opposed Biden’s proposal to tax crypto miners, is also attached to the legislation, as the two of them have worked together to previously draft the Lummis-Gillibrand Responsible Financial Innovation Act to introduce a comprehensive regulatory framework for the industry.
Both chairman Patrick McHenry (R-N.C.) and ranking member Maxine Waters (D-Calif.) of the House Financial Services Committee are involved in the negotiation process for the legislation, and the collaboration will need to continue for the bill to be signed into law.
Talking about the bill, Senator Gillibrand said,
“The bill is a product of common sense compromise. It balances the interests of federal, state and industry stakeholders. It will help drive innovation in the cryptocurrency landscape.”
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
