US Lawmakers Push Back on the Timeline For Stablecoin Regulation Bill
- Stablecoin regulation is one of the top priorities for lawmakers across the world.
- President Biden signed an executive order in March to investigate the potential risk of cryptocurrencies in the US.
Regulating stablecoins in the United States has been one of the most debated topics amongst lawmakers, with many believing that such digital assets are a threat to the economy of the country. Lawmakers have long been expected to produce a bill addressing the risks of stablecoins. However, according to new reports, such a bill would likely be seen in September.
Some members of the United States House of Representatives were said to have pushed back on the timeline for a regulatory bill and would most likely delay any vote on stablecoins until a few weeks’ time. Sources familiar with the matter claimed the house members were unable to finish a draft ahead of their committee meeting on Wednesday.
The bill would be the final attempt by US lawmakers to impose strict regulations on stablecoins in a bid to control the volatile cryptocurrency market. Several details are yet to be sorted out in the stablecoin bill. Those with a clear understanding of the situation claim that custodial wallets from the Treasury Department and reservations from the Securities and Exchange Commission were among the unresolved concerns in the proposal.
The Biden administration has remained open to the crypto world, and Treasury Secretary Janet Yellen allegedly plans to work in line with the administration in providing a response to the bill. The current has not offered a clear stance on the supposed bill, but Yellen had once called for regulatory clarification regarding stablecoins.
The decline of one of the biggest stablecoins at the time, UST, which lost its peg to the dollar, was said to have raised concerns amongst regulators and top officials. Terra’s collapse saw many investors lose their funds in what ended up becoming one of the biggest losses in the financial world. About $40 billion of investors’ funds were lost to Terra’s fall.
In March this year, President Biden signed an executive order calling for the examination of the risks posed by cryptocurrencies to the American economy. The order was unique in many ways, as it also revealed the administration’s plans to create a digital version of the US dollar.
President Biden’s executive order identified six core areas to examine, and they include consumer protection, financial inclusion, financial stability, illicit transactions, U.S. competitiveness, and responsible innovation. Reports of a rift between the White House and Treasury Secretary, Yellen have allegedly caused the administration to delay the release of its cryptocurrency policy.
Stablecoin Regulation Around the World
While many nations around the world are rolling out measures to control the crypto market and stablecoins at large, the US has found it challenging to agree on many bills proposing stablecoin regulation in the country. Some of the measures that would have regulated stablecoins in the US have been postponed or otherwise failed to get through the legislative process.
In the UK, legislators have stayed focused on their effort to regulate stablecoins despite a change in government this month. The UK has revealed plans to be more crypto-friendly and its Department of Treasury has reportedly explored stablecoins as a secure form of payment.
In other parts of the world, such as Europe, authorities are making progress in their bid to regulate stablecoins and the crypto industry. The European Central Bank recently called for uniformity on crypto regulation in the continent.
Authorities in Europe claim crypto regulation would offer more protection to investors and give the crypto industry better recognition. It appears that crypto regulation is bound to happen sometime this year. However, most crypto enthusiasts remain unsure how regulations will affect the current freedom that the industry enjoys.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
