Bill addressing stablecoins risks in US likely delayed until September: Report

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Lawmakers in the United States House of Representatives have reportedly pushed back the timeline for considering a bill addressing the potential risks of stablecoins.

According to a Monday report from the Wall Street Journal, people familiar with the matter said House members will likely delay voting on a stablecoin bill until September after being unable to complete a draft in time for a Wednesday committee meeting. The unresolved issues in the bill reportedly included provisions on custodial wallets from the Treasury Department and concerns from the Securities and Exchange Commission.

Treasury Secretary Janet Yellen reportedly wanted to coordinate with the Biden administration for her response to the bill. Neither has publicly weighed in on the proposed legislation, but Yellen previously called for regulatory clarity in the crypto space around stablecoins, citing concerns around TerraUSD (formerly UST) depegging from the U.S. dollar. President Joe Biden’s executive order from March also aims to address gaps in regulatory oversight on digital assets.

Glad to hear @SecYellen acknowledge the need for Congress to pass legislation that creates a sensible regulatory framework for stablecoins. pic.twitter.com/GXVvcKcKUb

— Senator Pat Toomey (@SenToomey) May 10, 2022

To date, lawmakers have deferred or otherwise been unable to come to an agreement on many of the bills proposing to regulate stablecoins in the United States. In February, New Jersey Representative Josh Gottheimer introduced a bill, the Stablecoin Innovation and Protection Act, that would allow the Federal Deposit Insurance Corporation to back stablecoins in a manner similar to fiat deposits. A bipartisan bill introduced in the Senate by Cynthia Lummis and Kirsten Gillibrand in June also proposed regulating stablecoins issued by financial institutions but may be delayed from consideration until 2023.

Across the pond, lawmakers in the United Kingdom have continued to move forward with legislation on stablecoins amid a shakeup in government — many members resigned in July in response to soon-to-be former Prime Minister Boris Johnson’s response to a scandal. The country’s Department of Treasury also reportedly began considering legalizing stablecoins as a form of payment.