U.S. Congresswoman Maxine Waters introduced a draft bill to regulate stablecoin issuers for consumer protection and financial stability.
Regulatory Framework for Stablecoin Issuers
The bill requires stablecoin issuers to comply with licensing conditions. The Federal Reserve will oversee compliance. Payment stablecoins must have liquid reserves through USD deposits, insured bank accounts, or Treasury bills. The regulation prohibits financial firms from controlling coin issuance operations. Non-compliance will result in substantial fines and criminal penalties.
Penalties for Unauthorized Stablecoin Issuance
Unauthorized stablecoin issuance incurs penalties up to $1 million per violation, with potential imprisonment of up to five years. The Federal Reserve gains enforcement power to work with the Treasury Department, SEC, and CFTC to ensure compliance. Consumer protection bodies will monitor transactions, enhancing trust in digital assets.
Bipartisan Efforts to Regulate Stablecoins
Legislative efforts reflect bipartisan cooperation aimed at establishing stable regulatory frameworks. Along with Waters’ bill, Senator Bill Hagerty and Representatives French Hill and Bryan Steil proposed their legislative versions for stablecoin regulation. These initiatives aim to support financial innovation while ensuring regulatory oversight.
The introduction of stablecoin regulations marks a significant step in financial oversight. The bill proposes a structured framework to ensure compliance, consumer protection, and financial stability. Ongoing legislative efforts and industry engagement indicate a broader commitment to regulating digital assets.
