US senators unveil stablecoin regulation bill

Senators Cynthia Lummis and Kirsten Gillibrand introduced a bill that imposes requirements on stablecoin issuers in the United States, including the mandate for dollar-backed tokens and full reserve asset backing.

The legislation, aimed at bolstering financial stability and transparency, sets a US$10 billion issuance cap for non-depository trust institutions and seeks to prevent algorithmic stablecoins.

The bill requires stablecoin issuers to maintain full reserves and operate with dollar-backed tokens exclusively, a measure intended to ensure that stablecoins can be reliably converted to dollars for consumer protection.

Issuers will face oversight from state and federal regulators, with the Federal Reserve Board of Governors overseeing non-depository trust companies and depository institutions authorized as national payment stablecoin issuers.

In response to concerns about digital currency transparency and stability, the bill emphasizes public disclosure of reserve assets.

Senators Lummis and Gillibrand, with their history of legislative efforts in digital asset regulation, view the stablecoin bill as a strong candidate for passage, especially if attached to other critical legislation.