U.S. Stablecoin Bill Nears Completion: Here’s What’s at Stake

New U.S. stablecoin legislation nears completion, promising both benefits and concerns for users, signaling a shift in cryptocurrency regulation.

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  • Major progress has been made on U.S. stablecoin legislation, with the possibility of a bill arriving before the elections.
  • While the bill presents potential benefits, concerns have arisen regarding its potential to stifle innovation.
  • Debates have ensued regarding the bill’s potential impact on stablecoin users.

In a promising turn of events, the final version of the U.S. stablecoin bill appears to be nearing completion. Recent developments suggest that the United States might indeed see new stablecoin legislation before the upcoming elections, a prospect that seemed improbable earlier this year.

Key Developments in Stablecoin Bill

Both the Senate and the House of Representatives have seen increased activity surrounding stablecoin regulation in recent weeks, signaling significant progress on the legislative front. Speaking to Bloomberg on Wednesday, the House Financial Services Committee expressed confidence in the imminent arrival of a stablecoin bill. 


Representative Maxine Waters, a vocal critic of earlier versions of the legislation, emphasized the importance of investor protection and the necessity of backing stablecoins with tangible assets. According to Waters, crafting the bill involved input from key governmental bodies, including the U.S. Federal Reserve, the Treasury Department, and the White House. 

Notably, negotiations between Waters, House Financial Services Committee Chairman Patrick McHenry, and Senate Majority Leader Chuck Schumer have gained momentum, with efforts to tie the legislation to an impending Federal Aviation Administration reauthorization.

In the Senate, Senators Cynthia Lummis and Kirsten Gillibrand introduced a new stablecoin bill last week. This proposed legislation seeks to ban algorithmic stablecoins and mandates that issuers fully back tokens with reserve assets.

Impact on Stablecoin Users

The proposed U.S. Stablecoin Bill seeks to establish a framework for these digital assets, aiming to bring both benefits and considerations for users:

  • By mandating real-world asset backing, the bill seeks to minimize the price fluctuations often experienced with unbacked stablecoins. This could make them a more reliable store of value, similar to traditional currencies.
  • Anti-Money Laundering (AML) rules would be enforced, potentially hindering criminals from using stablecoins for illicit activities. This can bolster user confidence and increase trust in the overall market legitimacy.
  • The bill incorporates provisions safeguarding users in case a stablecoin issuer encounters financial difficulties. This can offer peace of mind, knowing there might be protection for holdings.

Considerations for Users

However, some aspects of the bill raise concerns:

  • The potential ban on algorithmic stablecoins could restrict user choice. These stablecoins offer a different approach to maintaining price stability, and some users might prefer them.
  • New regulations could create barriers for new companies entering the stablecoin market, potentially leading to less competition. This could limit innovation and potentially impact user experience.

The Lummis-Gillibrand Act is still under development, and the final impact on users is yet to be fully understood. While the bill’s primary objective is to make stablecoins safer and more reliable for users, it’s crucial to stay informed about the specific details and their potential consequences before forming definitive conclusions.

Navigating Regulatory Challenges

Waters revealed discussions with Senate Banking Chairman Sherrod Brown regarding stablecoin regulation. Brown, who expressed openness to advancing the legislation earlier this month, hinted at the possibility of pairing the stablecoin bill with a marijuana banking bill, an idea that has gained traction but may face opposition from Republican leaders.

Despite potential challenges, Waters remains optimistic about overcoming resistance, particularly with regard to securing a floor vote in the Republican-controlled House. McHenry echoed this sentiment in March, suggesting that the stablecoin bill is primed for advancement pending the scheduling of a vote.

As anticipation builds and negotiations continue, stakeholders eagerly await the finalization of the U.S. stablecoin bill, a pivotal moment that could shape the future of cryptocurrency regulation in the country.

On the Flipside

  • The bill’s emphasis on asset-backed stablecoins could increase reliance on traditional financial institutions and potentially cede control to central banks.
  • Strict AML regulations, while intended to prevent illegal activities, could also lead to increased user data collection and privacy issues.

Why This Matters

If passed, this stablecoin bill would establish the first national framework for this type of digital asset, which could, in turn, boost user confidence in the sector and reduce price volatility while paving the way for wider crypto adoption.

If you’re interested in the details of the stablecoin bill, check out this article on the proposed legislation:
US Stablecoin Bill Aims to Rein In Crypto’s Dollar Substitute

If you liked this article, check out this one on Senator Elizabeth Warren’s opposition to a stablecoin bill:
Sen. Warren’s Resistance to U.S. Stablecoin Bill Draws Flak

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Kyle Calvert

Kyle Calvert is a cryptocurrency news reporter for DailyCoin, specializing in Ripple, stablecoins, as well as price and market analysis news. Before his current role, Kyle worked as a student researcher in the cryptocurrency industry, gaining an understanding of how digital currencies work, their potential uses, and their impact on the economy and society. He completed his Masters and Honors degrees in Blockchain Technology within Esports and Business and Event management within Esports at Staffordshire University.