🌋 Senators Lummis and Gillibrand Push for Stablecoin Regulation
posted 17 Apr 2024
Senators Cynthia Lummis and Kirsten Gillibrand have proposed a legislative framework for regulating payment-oriented stablecoins.
The bill defines stablecoins as any digital asset pegged to the dollar and utilized for payment purposes, explicitly excluding them from being treated as securities.
State-authorized institutions and Federal Reserve-registered non-depository trusts could issue stablecoins, with an issuance limit of $10 billion for the latter. The new regulations would also require U.S. issuers to maintain and disclose their reserves.
The proposal notably prohibits the use of algorithmic stablecoins, where price stability is algorithmically managed rather than backed by other assets.
This is part of several regulations for the digital asset market proposed by Senators Lummis and Gillibrand, none of which have been enacted so far.
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