Republican Senator Pat Toomey, a senior member of the Senate Banking Committee, has drafted a bill proposing a regulatory framework for stablecoins in the United States.
According to a draft published Wednesday, the “Stablecoin Secure Transactions and Reserves Transparency Act”, also known as the Stablecoin TRUST Act, proposes that digital assets be identified as “payment stablecoins”, a convertible virtual currency used as a medium of exchange that can be redeemed for fiat money by the issuer.
The bill proposed that these offerings be exempt from securities regulations, amending existing legislation to ensure that the definition of “security” did not include a payment stablecoin.
legislation it also proposed that stablecoin issuers—which would include national trust banks and state-chartered trusts—be licensed by the Office of the Comptroller of the Currency. Issuers would be required to back their stablecoin reserves with assets “that are cash and cash equivalents or high-quality Tier 1 liquid assets denominated in US dollars.”
Toomey said the bill focused on stablecoins because of their “potential, among other things, to speed up payments and automate transactions”:
“The regulatory framework proposal I am releasing today will allow this crypto innovation to continue to flourish while protecting consumers and minimizing the potential risks of stablecoins to the financial system. I look forward to receiving feedback on this legislation from my colleagues and stakeholders. as Congress continues its work on stablecoin regulation.”
US lawmakers, both in the House of Representatives and the Senate, have previously discussed how stablecoins could be integrated into the framework of financial regulation.. At a hearing on stablecoins held in December, Toomey proposed that stablecoin issuance should not be limited to insured depository institutions. North Carolina Rep. Patrick McHenry has proposed a state-level regulatory framework on stablecoins instead of a comprehensive federal law. during a House hearing on digital assets in February.
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