The Stalemate on Stablecoin Legislation in the U.S. House
House lawmakers recently hit a roadblock in reaching a bipartisan agreement on stablecoin legislation. The Financial Services Committee Chair, Patrick McHenry (R-N.C.), pointed fingers at the White House for the deadlock. However, the committee’s top Democrat countered, claiming it was McHenry who halted the discussions.
McHenry’s Disappointment over White House’s Intransigence
McHenry expressed his disappointment over the failed negotiations, attributing the stalemate to the White House’s unwillingness to compromise. However, he did not elaborate on the specifics of the disagreement with the executive branch.
Waters’ Opposition to the Stablecoin Bill
Maxine Waters (D-Calif.), the committee’s senior Democrat, criticized the bill as “deeply problematic and bad for America.” She argued that the legislation could lead to a “race to the bottom” by creating 58 different licenses, potentially allowing issuers to include a wide range of assets in their reserve. Waters also voiced concerns about the possibility of large corporations like Meta or Walmart issuing money.
The Contention Surrounding the Republicans’ Stablecoin Bill
The Republicans’ stablecoin bill, dubbed the Clarity for Payment Stablecoins Act, was introduced by McHenry last week. It aims to provide a regulatory framework for crypto tied to the value of fiat currency. However, the bill has been a source of contention, with Republicans pushing forward and Democrats dragging their feet on every procedural point.
The Future of Stablecoin Oversight in the U.S.
Despite the ongoing stalemate, the need for stablecoin oversight in the U.S. remains. McHenry has previously warned that rival jurisdictions are “ahead of the game” on regulating crypto. With the European Union’s markets in Crypto Assets regulation (MiCA) set to take effect in 2024, the U.S. must keep pace.
