Senators Lummis and Gillibrand Introduce New Bill to Regulate Stablecoins
Senators Cynthia Lummis and Kirsten Gillibrand have joined forces to propose a new bill aimed at regulating stablecoins.
The bill, which focuses on defining how stablecoins will operate within the United States, represents another attempt to introduce targeted legislation for the crypto market.
Under the proposed legislation , payment stablecoin issuers would be subject to reserve and operational requirements, including the creation of subsidiaries dedicated to issuing stablecoins.
Additionally, stablecoin issuers would be obligated to deal exclusively in dollar-backed tokens.
The bill defines payment stablecoins as digital assets pegged to the U.S. dollar that are intended for use as a means of payment or settlement.
Conversion to dollars would be an obligation for issuers, and the asset itself would not be classified as a security.
Non-depository trust companies registered with the Federal Reserve Board of Governors or depository institutions authorized as national payment stablecoin issuers would be eligible to become issuers, with both state and federal regulators overseeing their operations.
Senators Cynthia Lummis and Kirsten Gillibrand introduce the Lummis-Gillibrand Payment Stablecoin Act of 2024, aiming to regulate stablecoins while fostering financial innovation in the US. Legislation emphasizes state-federal partnership for supervision under $10 billion.
— BlockVoyager (@BlockVoyagerAIO) April 17, 2024
The bill also mandates that stablecoin issuers ensure their tokens are fully backed by reserve assets and publicly disclose the nature of those assets.
They would also need to engage a non-depository trust as a custodian, which, in turn, would be required to use a depository institution as a
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