Last month the Republican chair of the House Financial Services Committee introduced a new version of the primary U.S. legislative proposal aimed at regulating stablecoins. Notably, this draft incorporated certain ideas put forth by Democratic lawmakers, indicating a potential step towards bipartisan discussions. Many experts saw this as a significant development in the journey to establish U.S. regulation of cryptocurrencies.
Rep. Patrick McHenry (R-NC) announces NO DEAL on stablecoins with Rep. Maxine Waters (D-Calif), says he’s “disappointed.”
Here’s a twist: McHenry is blaming the White House for an “unwillingness to compromise” in negotiations.
— Brendan Pedersen 🏦 (@BrendanPedersen) July 27, 2023
Rep. Patrick McHenry (R-N.C.) has prioritized stablecoin legislation since last year, even before assuming control of the committee. However this bill reached a no deal in the US Congress much to his disappointment. Read on for more details.
Congressman McHenry Disappointed by No Deal on Stablecoins Bill
On Thursday, U.S. Congressman Patrick McHenry expressed his disappointment regarding the no deal on the payments stablecoins bill with Democratic Representative Maxine Waters. He attributed the failure to the Democrats’ unwillingness to compromise during negotiations. The bill, titled the ‘Clarity for Payment Stablecoins Act of 2023’, would have been referred to as such if it had been passed.
It has been reported by Brendan Pedersen on Twitter that there was commotion in the House Financial Services Committee due to insufficient votes. During the proceedings, Waters stressed the importance of a question of consideration and a recorded vote on the issue. McHenry attributed the failure to reach a consensus on important provisions as the cause for the no deal.
The proposed stablecoin bill presents the U.S. Federal Reserve as the key regulator responsible for setting requirements for issuing stablecoins, while granting state regulators powers to oversee issuing companies. It aims to establish comprehensive guidance on supervising and enforcing stablecoin markets in the United States, including a two-year moratorium for collateralized stablecoins.
The bill also limits who can issue payment stablecoins in the U.S., mandating reserves backed with various assets like the U.S. currency, insured demand deposits, Treasury bills, and central bank reserve deposits. To prevent stablecoin collapses, issuers must submit monthly certifications and examination reports by a registered public accounting firm.
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