Two US lawmakers on Wednesday unveiled a bill that will create a regulatory framework for payments stablecoins.
In a statement, Senators Cynthia Lummis (R-WY) and Kirsten Gillibrand (D-NY) said the bipartisan Lummis-Gillibrand Payment Stablecoin Act will protect consumers, enable innovation and promote the dominance of the U.S. dollar, while doubling banking system is maintained.
“To meet the growing demand for our ever-evolving financial sector, we must enact legislation that strikes the careful balance between establishing a clear and workable framework for stablecoins while protecting consumers.”
The senators say the bill will protect consumers by requiring stablecoin issuers to maintain 1:1 reserves and prohibiting the use of unbacked, algorithmic stablecoins – or those whose value is not dependent on a reserve of assets, but depends on code-based mechanisms.
If the bill becomes law, stablecoin issuers will be required to maintain one-for-one asset reserves to ensure that the stablecoins they issue are fully backed by cash and cash equivalents. They will also only issue dollar-backed stablecoins.
The statement said the proposed law would also prevent the illegal use of stablecoins by requiring issuers to comply with US anti-money laundering and sanctions regulations, support the US dollar as a medium for digital exchange and counter foreign ambitions to establish alternative settlement systems. to create.
Says Gillibrand,
“Adopting a regulatory framework for stablecoins is absolutely critical to maintaining the dominance of the U.S. dollar, promoting responsible innovation, protecting consumers, and cracking down on money laundering and illicit financing.”
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