Congresswoman Maxine Waters, the main Democrat on the Home Monetary Providers Committee, known as for a bipartisan settlement on stablecoins by the shut of 2024.
Throughout a committee listening to on Sept. 24, Waters expressed optimism {that a} legislative deal may very well be achieved, emphasizing the necessity for strong federal laws and shopper protections as a part of the ultimate framework.
Waters mentioned:
“Mr. Chairman, earlier than the tip of this 12 months, I would like us to strike a grand cut price on stablecoins and different long-overdue payments. Since 2022, we’ve been working tirelessly to succeed in an settlement and have each made concessions.”
Stablecoin invoice
Waters and Republican Rep. Patrick McHenry, the committee chair, have been collaborating on a invoice to manage stablecoins since 2022, with the aim of making a sturdy regulatory basis for the business.
The committee superior a model of the invoice in 2023, nevertheless it has struggled to realize wider assist resulting from disputes over provisions permitting state regulators to approve stablecoins with out the Federal Reserve’s enter, a measure Waters described as “deeply problematic.”
Waters confused the significance of stablecoins being backed by safe reserves, corresponding to short-term Treasury payments, to make sure their stability. She additionally emphasised the necessity for the Fed to take care of a key supervisory function, much like frameworks in different international locations.
McHenry expressed hope for progress on stablecoin laws whereas additionally calling for broader regulatory readability round digital belongings. He mentioned he’s “optimistic” about stablecoin regulation and hopes that it’s going to result in “much-needed readability on digital belongings.”
With the tip of the legislative session approaching, Congress should move vital payments quickly. McHenry additionally famous that his separate crypto market construction invoice, referred to as FIT21, may acquire momentum earlier than the 12 months concludes.
Commissioners testify
The listening to additionally featured testimony from all 5 US Securities and Alternate Fee commissioners, together with Chair Gary Gensler and Commissioner Hester Peirce.
Lawmakers centered their questions on the company’s dealing with of digital belongings and broader rulemaking points, with Republicans criticizing the SEC’s “regulation by enforcement strategy” and questioning whether or not the regulator was able to offering regulatory readability for the business.
Peirce agreed with the lawmakers’ criticism of the company’s ambiguous strategy to digital asset regulation and said that the SEC has the instruments to offer clear pointers however has failed to take action.
She mentioned:
“We’ve [SEC] taken a legally imprecise view to masks the shortage of regulatory readability… We are able to present pointers and select to not.”
Peirce additional emphasised that the SEC’s obscure stance on token classification creates confusion out there. She argued that the company ought to have clarified that the tokens themselves aren’t securities, which might assist information secondary gross sales and platform listings.
Different commissioners echoed Peirce’s considerations, with Mark Uyeda noting that the SEC has a variety of instruments obtainable to handle the regulatory gaps, together with defining requirements for token classification and crypto-related exchange-traded merchandise.