US senator Toomey introduces stablecoin bill as congressional session wraps up

Republican Senator Pat Toomey, who is acceptable to discontinue from U.S. Congress astatine the extremity of the term, has utilized 1 of his past fewer weeks successful bureau to present a caller stablecoin bill, aimed astatine creating a regulatory model for “payment stablecoins.”

Toomey — who besides serves arsenic the Ranking Member of the U.S. Banking Committee — said the Dec. 21 bill, called the Stablecoin TRUST Act of 2022 would service arsenic a model for stablecoin regularisation for his chap senators who are looking to push retired stablecoin authorities successful 2023.

In a statement, the legislator called stablecoins an “exciting technological improvement that could alteration wealth and payments,” adding:

“By digitizing the U.S. dollar and making it disposable connected a global, instant, and astir cost-free basis, stablecoins could beryllium wide utilized crossed the carnal system successful a assortment of ways.”

If passed by Congress, the measure would licence non-state and non-bank institutions to contented stablecoins, truthful agelong arsenic they get a national licence that is created and issued by the U.S. Office of the Comptroller of the Currency (OCC) and that the stablecoins are backed up with “high-quality liquid assets.”

The stablecoin issuers indispensable besides comply with a caller nationalist disclosure standard, intelligibly outline redemption policies and supply regular attestations from authorized accounting firms.

The measure would exempt stablecoin issuers from U.S. securities laws, truthful agelong arsenic they don’t connection interest-bearing products oregon services oregon different enactment similar an concern oregon advisory firm.

Investor extortion is besides good embedded into the bill, with it stating that successful the lawsuit of an issuer’s insolvency, stablecoin holders volition beryllium the archetypal to beryllium reimbursed — which is possibly the astir notable quality betwixt this measure and Toomey’s earlier bill that was introduced into Congress successful Apr. 2022.

The measure would besides lone use to “payment” stablecoins that tin beryllium straight converted to fiat by the issuer — specified arsenic the U.S. Dollar — not commodity-like oregon algorithmically-backed stablecoins.

Related: Stablecoin regulations successful the US: A beginner’s guide

Toomey said helium hoped the latest measure would laic the groundwork for his colleagues to walk authorities adjacent twelvemonth which would safeguard lawsuit funds "without inhibiting innovation,” the outgoing congressman said.

However, it remains to beryllium seen however Toomey’s latest stablecoin volition stack up against the Stablecoin Transparency Act, which was introduced into Congress by chap Republican Senator Bill Hagerty connected Mar. 31. 2022.

A cardinal quality betwixt the 2 is that the passing of the Stablecoin Transparency Act would categorize the issuance of stablecoins arsenic securities nether U.S. securities laws and fully collateralized information repurchase agreements would request to beryllium acceptable successful place.

Toomey announced successful a Dec. 16 code to his chap senators helium volition discontinue astatine the extremity of the Congressional league connected Jan. 3. 2023.

Replacing Toomey arsenic the Senate Banking Committee’s Ranking Member is Republican Senator Tim Scott, whose views connected the integer plus manufacture haven’t yet been publicized.