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Senators Lummis and Gillibrand Introduce 179-Page Bill to Regulate Stablecoins

Apr 17, 2024, 09:28 AM

U.S. Senators Cynthia Lummis and Kirsten Gillibrand introduced a new stablecoin bill aimed at regulating the issuance and management of stablecoins. The 179-page bill, presented early Wednesday, allows banks and non-bank trust companies to issue stablecoins through dedicated subsidiaries and bans unbacked, algorithmic stablecoins. It also introduces capital and one-to-one reserve requirements. The senators emphasized the importance of U.S. leadership in stablecoin regulation, warning that leaving it to other countries would be a mistake. The bill has sparked a mix of reactions, with some viewing it as a positive step that legitimizes cryptocurrencies like Ethereum, which 'wins big', while others, including some regulatory experts, criticize it as 'deeply disappointing work', potentially stifling innovation by favoring a narrow band of centralized, custodial stablecoins.