US Representatives French Hill and Bryan Steil have introduced a discussion draft for a bill that seeks to regulate payment stablecoins. The stablecoins are digital assets pegged to the US dollar. The proposed legislation would establish a structured framework for issuing and managing these digital assets within the country.
US lawmakers propose stablecoin bill to boost dollar dominance. Source: XTwo-Year Ban on Self-Issued Stablecoins Included in the Proposal
One of the key provisions in the bill is a two-year ban on endogenously collateralized stablecoins. It means that these digital currencies cannot be backed by self-issued digital assets. This restriction aims to prevent instability in the financial system and ensure that stablecoins maintain solid backing.
Additionally, the bill directs the US Treasury Department to conduct a comprehensive study on the impact of stablecoins. Lawmakers believe such a study will provide crucial insights into how digital currencies affect financial markets and consumer protection.
Trump Administration Seeks to Bring Digital Assets Onshore
The introduction of the draft bill aligns with the Trump administration’s growing interest in regulating and integrating stablecoins into the US financial system. House Financial Services Committee Chairman French Hill stated that the goal is to work with the Trump administration, the House, and the Senate to finalize a system that enables the issuance of federally regulated, dollar-backed digital assets.
David Sacks, Trump’s top crypto advisor, said stablecoins could help strengthen the US dollar’s role in the global economy. This perspective suggests that the administration sees digital assets as a tool for maintaining the dollar’s influence in international finance.
Stablecoin Regulations Aim to Protect the US Dollar’s Status
The push for stablecoin regulations comes amid concerns over the US dollar’s role as the world’s primary reserve currency. While some observers see Trump’s recent executive order on cryptocurrencies as a pro-crypto move, others believe the administration’s primary motivation is to safeguard the dollar’s global standing.
Matthew Sigel, Head of the digital assets research VanEck, also emphasized that establishing a framework would provide clarity for issuers. The clear regulation will encourage technological advancements and solidify the US dollar’s global leadership.
VanEck’s Matthew Sigel said that New Stablecoin Draft Would Encourage Innovation While Protecting Consumers. Source: XSenate Banking Committee Chairman Tim Scott also supported the initiative, stating that regulating stablecoins is necessary to foster financial innovation while reinforcing the dollar’s position in the world economy.
Senate’s Separate Bill Also Aims to Regulate Stablecoins
The House proposal is not the only effort to introduce regulations. Earlier this month, US Senator Bill Hagerty introduced a separate bill called the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act. This legislation seeks to advance Trump’s pledge to make the US a global leader in cryptocurrency.
Hagerty’s bill has received bipartisan support from lawmakers, including Senators Tim Scott, Kirsten Gillibrand, and Cynthia Lummis. He believes stablecoins could increase demand for US Treasury bonds and enhance transaction efficiency in financial markets. In a statement, he stressed the need for a safe and pro-growth regulatory framework to drive innovation and position the US as the world’s cryptocurrency hub.
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The post US Lawmakers Push Stablecoin Bill to Strengthen Dollar’s Global Role appeared first on Coinchapter.
