New Bill Aims to Establish Regulatory Framework for Stablecoins

Stablecoin Regulatory Framework Proposed

Republican Sen. Bill Hagerty has introduced a new bill titled the "Guiding and Establishing National Innovation for US Stablecoins." This legislation aims to create a regulatory framework for stablecoins, focusing on standards for asset backing and transparency. The bill mandates that stablecoins be backed by U.S. dollars, Treasury bills, or Federal Reserve notes, and requires issuers to provide monthly audited reports.

Bipartisan Support for the Legislation

The bill has gained bipartisan support, with Sens. Kirsten Gillibrand (D-N.Y.), Tim Scott (R-S.C.), and Cynthia Lummis (R-Wyo.) joining as cosponsors. It proposes a "light-touch" regulatory approach, balancing federal and state oversight responsibilities. This collaborative effort reflects growing interest in regulating digital assets while fostering innovation.

Legislative Context and Previous Efforts

Hagerty's bill builds on a discussion draft released in October 2024, which shared similarities with the House of Representatives' Clarity for Payment Stablecoins Act. However, the House bill stalled due to disagreements over state regulators' roles. The new legislation aims to address these challenges and provide clarity for the stablecoin industry.

Alignment with Broader Crypto Policy

The introduction of Hagerty's bill aligns with President Donald Trump's supportive stance on the crypto industry. Trump has expressed a desire to make the U.S. a global leader in crypto and has established a federal working group to develop regulatory frameworks for digital assets, including stablecoins.

This legislation represents a significant step in the ongoing effort to regulate stablecoins, balancing innovation with consumer protection and financial stability.