Retired US Senator Pat Toomey introduces bill to regulate stablecoins

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Republican U.S. Senator Pat Toomey on Wednesday introduced a bill to establish regulations for stablecoins and strengthen sensible regulation of cryptocurrency. This is part of a broader push to establish lifelines for the industry following the collapse of crypto exchange FTX last month.

See Related Article: US Senator Elizabeth Warren Introduces Know Your Crypto Customer Bill Following FTX Collapse

Fast facts

Dubbed the Stablecoin TRUST Act or Transparency of Reserves and Uniform Safe Transactions, the bill follows the Pennsylvania senator’s previous attempts to regulate the crypto industry, including the TRUST Act introduced with limited effect in April, which affected also stablecoins.

I hope this framework lays the foundation for my colleagues to pass legislation next year that protects customer funds without hindering innovation, Toomey said in a press release. Toomey announced earlier this year that he would not run for office, raising doubts about the impact of his bill.

Stablecoins are a type of cryptocurrency pegged to the value of an underlying asset, usually the US dollar.

The proposed bill would ensure that stablecoins are not considered securities, removing them from the jurisdiction of the Securities and Exchange Commission and the Commodities Futures Trading Commission.

It would also prevent issuers of stablecoins from being considered investment advisers or corporations and allow non-banking entities to issue them. This would create a new federal license for payment stablecoin issuers that would be managed by the same agency that regulates traditional banks, the Office of the Comptroller of the Currency.

This bill will also ensure that the Federal Reserve, which has shown significant skepticism of stablecoins, will not be able to shut down this activity, Toomey added in the same statement announcing the proposed bill. law.

See related article: Midterms in the United States: Lockdown and Progress in Crypto Industry Regulation?

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