Finally more regulatory clarity – The United States will they finally decide regulaterather than banning, stablecoins ? This bill on stablecoins, if adopted without major modifications, could permanently register these cryptocurrencies competing with fiats, in the American financial landscape.
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The high regulatory hopes of stablecoins in the United States
US senator Patrick Toomey introduced a bill on the regulation of stablecoins : the 2022 Law on Transparency of Stablecoin Reserves and Uniform Transaction Security – the Stablecoin TRUST Act.
Patrick Toomey is a member of the Senate Banking Commission. Thanks to this bill, the United States is among the pioneer countries in the West. They could thus regulate and officially recognize stablecoins as part of its financial system.
the Stablecoin TRUST Act defines stablecoins, as “payment stablecoins”. These are considered digital assets that:
- Can on the one hand be converted “directly into fiat currency by the issuer” ;
- On the other hand have a “stable value against one or more fiat currencies”.
The bill clarifies that these payout stablecoins are only no titles. Thanks to this status, will these cryptocurrencies then escape any strict regulation of the sector by the American SEC?
the Stablecoin TRUST Act further provides for measures touching the stablecoin issuersprovisions that aim to protect users of these cryptocurrencies.
Issuers of stablecoins will need to obtain at least theone of the regulatory licenses to operate legally in the United States: a license from theOffice of the Comptroller of the Currency (OCC), a state money transmitter license or similar authorization, or a traditional banking charter.
They will also be subject to a disclosure regime. This regime has the advantage of bringing more transparency to the sector. Issuers of stablecoins will thus have to:
- Be the subject ofregular audits ;
- detail its redemption policies stablecoins;
- Clearly specify the type of guarantees that ensure the stability of their stablecoins.
The adoption of such a bill poses the question of necessity – or not – of the issuance of a digital dollar by the United States Federal Reserve (Fed). Indeed, the tether (USDT) or the USD coin (USDC) are far from being totally decentralized. They have presented, in the past, flaws related to their governance. They remain, however, a better alternative to an MNBC which could give the government a full control of its citizens’ currency.
The time for regulation has come, and with it the time for uncertainty. It is ESSENTIAL to make your stablecoins work safely. Earn interest with your USDC on Kucoin Lending (affiliate link).