How to Upgrade House Stablecoin Bill 2.0 to Version 2.1

Jack Solowey andJennifer J. SchulpTomorrow, the House Financial Services Committee ’s Digital Assets Subcommittee will holdanother hearing on stablecoins (crypto tokens pegged to the value of another asset like the U.S. dollar).Ahead of the hearing, the Subcommittee released two new discussion drafts of stablecoin legislation, a  74 ‐​pager and a  34 ‐​pager. These drafts appear to be thereportedseparatepartisan efforts by Democrats and Republicans after they essentially disowned an earlier bipartisan draft —the “ugly baby” they were at one point co‐​parenting.Whereas the 74 ‐​page draft is strikingly similar to the “ugly baby,” the 34‐​page draft—call it “Bill 2.0”—is a more significant update. While the longer draft would increase federal authority to disapprove certain stablecoin issuers—empowering the Federal Reserve Board of Governors (“Fed Board”) to deny required registrations by state‐​approved stablecoin issuers—Bill 2.0 would open the door to more kinds of stablecoin issuers, permit technological experimentation, and help to clarify longstanding jurisdictional issues.At a  high level, U.S. stablecoin policy should allow for a competitive stablecoin market composed of diverse issuers. Doing so means establishingobjective standards for collateral and disclosures and restricting regulatory discretion that canchoke off competition and privilege insiders. Bill 2.0 contains important upgrades that could help the U.S...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs