GOP Senator Proposes Framework for Stablecoin Regulation

Pat Toomey (R-Pa.), a leading member of the Senate Banking Committee, has introduced a bill to make a new regulatory framework for stablecoins, CoinDesk wrote Wednesday (April 6).

Toomey announced the “Stablecoin Transparency of Reserves and Uniform Safe Transactions Act of 2022,” also called the Stablecoin TRUST Act.

This is part of a way to see how regulators in the U.S. could approach companies issuing cryptocurrencies whose prices are pegged to the dollar or other such things.

The bill would reportedly define a “payment stablecoin,” make it so the Office of the Comptroller of the Currency (OCC) can create a new license for stablecoin issuers, allow insured depository banks issue payment stablecoins and address state regulatory oversights.

The report said “payment stablecoins” would encompass stablecoins issued by a centralized entity, are pegged to and can be converted to fiat, are to be used widely, don’t confer interest and where transactions are recorded on a public ledger.

CoinDesk noted that stablecoin issuers would have to choose between securing the OCC license, a state money transmitter or some other kind of license. From there, the companies would be subject to a disclosure regime, making it so they have to secure regular attestations, put in words their redemption policies and say what actually backs their coin.

PYMNTS wrote that the U.K. will be validating stablecoins as an accepted payment form, which will consist of a new international hub for crypto asset tech and investment.

Read more: Stablecoins Embraced as Valid Payment Form in UK

Stablecoins will be brought within a regulatory framework and eventually be able to be used for payment in a recognized way. Chancellor of the Exchequer Rishi Sunak said the ambition was to make the U.K. a “global hub” for crypto technology.

Sunak said the measures would allow firms to “invest, innovate and scale up.” In his estimation, the goal would be to see “the businesses of tomorrow — and the jobs they create — here in the U.K., and by regulating effectively we can give them the confidence they need to think and invest long-term.”