Crypto Advocacy Group Coin Center Opposes Newly Proposed Stablecoin Act in Senate
Summary:
US-based crypto advocacy group, Coin Center, has raised concerns about the newly introduced Payment Stablecoin Act in the Senate. The group branded it as potentially unconstitutional due to the proposed ban on algorithmic stablecoins. The executive director of Coin Center, Jerry Brito, commended the idea of a regulatory framework for stablecoins in the U.S, but criticized the outright ban on certain business models. The legislation, if passed, would only allow U.S-approved issuers to release dollar-pegged stablecoins. Coin Center suggested that another bill, the Clarity for Payment Stablecoins Act, awaiting a full House vote, offers a more reasonable approach with a two-year delay as opposed to an outright ban.
Cryptocurrency advocacy group from the United States, Coin Center, has shared its apprehension regarding a bill introduced recently in the Senate designed to create and regulate a framework for payment stablecoins. On April 19, Coin Center voiced their opposition to the Payment Stablecoin Act presented by Senators Kirsten Gillibrand and Cynthia Lummis, citing it as "problematic policy" and potentially breaching constitutional rights due to its proposed ban on algorithmic stablecoins. They stated that such a ban indirectly aims at code, which potentially infringes upon First Amendment protections.
The group insists that while it may be appropriate to require issuers of products like Terra to register with the SEC and provide suitable disclosure (which ultimately could undermine their utility as a stablecoin), an outright prohibition of a specific business model is uncalled for and stifles innovation. They believe that anyone compliant with securities laws should be able to launch a product on the market.
Jerry Brito, Executive Director of Coin Center, expressed that forming a regulatory structure for stablecoins in the U.S. was a "commendable endeavor". As per the text of the proposed legislation, only U.S.-endorsed issuers would have the permission to release dollar-pegged stablecoins.
U.S. Congress members in both the House of Representatives and Senate are pushing towards introducing legislative solutions for stablecoins. In the meantime, Coin Center suggests that the Clarity for Payment Stablecoins Act - a bill awaiting a full House vote - poses a more acceptable approach to algorithmic stablecoins with a proposed two-year delay as opposed to an abrupt ban.
In another development, TerraUSD's detaching from the U.S. dollar was among the occurrences that led to the cryptocurrency market's slump in 2022. Numerous firms wound up bankrupt, while American regulators and officials consistently launched civil and criminal proceedings against individuals involved in dubious activities.
On April 16, Senator Sherrod Brown, the Senate Banking Committee's chair, reportedly mentioned that crafting a stablecoin bill would be a priority in the current legislative session as long as his apprehensions were addressed. At the time of reporting, the House had made no plans to arrange a floor vote for the Clarity for Payment Stablecoins Act.
Published At
4/19/2024 9:50:25 PM
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