The U.S. House Financial Services Committee has released a draft of a new stablecoin bill that proposes a moratorium on stablecoins backed by other cryptocurrencies and a study of a central bank digital currency (CBDC). This is the first major piece of cryptocurrency legislation to move in 2023 and follows two significant incidents involving stablecoins over the past year.
The proposed bill aims to define payment stablecoin issuers and calls for a moratorium on stablecoins backed by tokens until a study on the subject can be conducted. It also requests a study of the potential impact of a CBDC issued by the Federal Reserve.
Stablecoins have become increasingly popular in recent years, with their value tied to an underlying asset such as the U.S. dollar or another cryptocurrency. However, they have faced scrutiny due to their potential for destabilizing the financial system if their value were to suddenly drop or if their underlying asset were to become worthless.
The proposed legislation is likely to be of interest to crypto investors and policymakers worldwide, as the U.S. is a key player in the global cryptocurrency market. If passed, the bill would have significant implications for the industry and could serve as a model for other countries considering their own stablecoin regulations.
The bill’s publication was first reported by Punchbowl News and has been circulating among lawmakers since last fall. A House Financial Services subcommittee will hold a hearing on stablecoins on Wednesday, featuring Dante Disparte from Circle Internet Financial, Jake Chervinsky from the Blockchain Association, Columbia Professor Austin Campbell, and New York Department of Financial Services Superintendent Adrienne Harris.
The hearing takes place a day after the full Financial Services Committee meets to hear from Securities and Exchange Commission Chair Gary Gensler. If the bill passes, it will be fascinating to see how the cryptocurrency industry responds and adapts to the proposed changes.
