- Republican Senator Pat Toomey has recently put forward a bill regarding the regulation of stablecoins in the United States.
- He highlighted that the proposed regulatory framework would protect consumers and minimise the potential risks from the stablecoins to the financial system.
- The US lawmakers are constantly giving thoughts to the stablecoins on how they can be integrated with the financial regulatory framework.
Pat Toomey, a Republican Senator and a member of the Senate Banking Committee, has recently drafted a bill proposing a regulatory framework for stablecoins in the United States.
Stablecoins have the potential to speed up payments and automate transactions
The draft, the Stablecoin Transparency of Reserves and Uniform Safe Transactions Act, or the Stablecoin TRUST Act, puts forward that the virtual assets should be identified as payment stablecoins. A convertible digital currency is utilised as a medium of exchange that can be redeemed for fiat by the issuer.
Furthermore, the bill proposed that such offerings should not be included in securities regulations by altering the current laws to make sure that the meaning of security does not include a payment stablecoin.
The bill proposed that the stablecoin issuers, which would comprise licensed state-chartered trusts and national trust banks, should be licensed by the Office of the Comptroller of the Currency.
And that the issuers would be needed to support their stablecoin reserves with assets which are cash and its equivalents or level one high-quality liquid assets denominated in United States dollars.
Tomey highlighted that the draft bill is aimed at stablecoins because they have the potential, along with other things, of speeding up payments and automating the transactions.
Additionally, he highlighted that the proposed regulatory framework he is releasing would facilitate the crypto innovation to keep on blooming while protecting consumers and minimising the potential risks from the stablecoins to the financial system. And that he looks forward to receiving feedback on the legislation from his colleagues and stakeholders as Congress continues its work on regulating stablecoins.
The US lawmakers in both the House of Representatives and Senate are constantly giving thoughts to the stablecoins as to how they can be integrated with the financial regulatory framework. And various Senators are constantly proposing something or the other associated with the crypto industry.
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