2023-04-19T16:30:09-04:00April 19th, 2023|5- Client Report|

Stablecoin Legislation Faces Long Odds

As we anticipated, the HFSC Digital Asset Subcommittee hearing today on federal stablecoin legislation did not entertain bipartisan expressions of support for the draft noticed with the hearing announcement. Indeed, both Subcommittee Chairman Hill (R-AR) and full committee Ranking Member Waters (D-CA) outlined numerous and often conflicting concerns likely to slow redrafting of a measure Chairman McHenry (R-NC) hopes will remain bipartisan in order to enhance the already-challenging odds of enactment in this Congress. As this report details, significant outstanding issues include the extent to which nonbank stablecoin issuers operate outside the full range of bank-like rules, the risks this presents, how best to address inclusion, and whether there should be federal preemption.