WASHINGTON—With one senator expressing some concerns around cryptocurrencies, the companies that sell it and crypto-related advertising, the Senate Banking Committee conducted a hearing on the President’s Working Group (PWG) on Financial Markets’ report on stablecoins.
The discussion included debate around the use cases for stablecoins and the potential advantages, as well as the risks that may be posed.
Among those shared their concerns were Committee Chairman Sherrod Brown (D-OH), who said his concerns around stablecoins include that they unsafe product that, should they lose their value, would hit working class Americans the hardest in the process.
But NAFCU noted Ranking Member Patrick Toomey (R-PA) adopted a different approach to stablecoins, suggesting there is potential for speeding up transfer and ledger settlement. However, Toomey also reiterated his principles for stablecoins while pointing out his concerns with the PWG report.
Draft Bill Introduced
Meanwhile, Rep. Josh Gottheimer (D-NJ) released the draft text of a bill that would set up a new regulatory structure for certain stablecoins, including government-backed insurance similar to what's currently in place for deposits at financial institutions.
Of note, Gottheimer's bill would set up a regulatory regime around "qualified" stablecoins, a designation he describes as a kind of "seal of approval,” said NAFCU in its analysis.
In addition, these qualified stablecoins would be redeemable on demand on a one-to-one basis for U.S. dollars and would be issued by either a bank or a non-bank that met certain rules, including oversight by federal financial regulators at the Office of the Comptroller of the Currency and reserve requirements, NAFCU said.
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