Stablecoin

Patrick

2024

April

United States Senator Bill Hagerty is building on House member Patrick McHenry’s stablecoin legislation. Hagerty has released a discussion draft of the Clarity for Payment Stablecoins Act of 2024, with a few refinements of McHenry’s 2023 bill of the same name. McHenry is retiring at the end of his current term.
Hagerty, a member of the Senate Banking Committee,&nbsp;<a data-ct-non-breakable="null" href="https://www.hagerty.senate.gov/press-releases/2024/10/10/hagerty-releases-discussion-draft-of-comprehensive-stablecoin-legislation/" rel="noopener noreferrer nofollow" target="_blank" text="null" title="null">acknowledged</a>&nbsp;the new legislation’s debt to its predecessor and emphasized its key differences in a statement.
<h2 id="tweaking-a-consensus">Tweaking a consensus</h2>
The most dramatic change in Hagerty’s bill, as compared to the 2023 version, concerns the role of states.
In a final section, titled State-Level Regulatory Regime, which has no analog in McHenry’s bill, Hagerty specifies that stablecoin issuers that have less than $10 billion in market capitalization can be regulated at the state level. Issuers of stablecoins with larger caps can seek waivers to allow them to remain under state, rather than federal, regulation.
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 <img alt="Sen. Hagerty introduces Clarity for Payment Stablecoins Act of 2024" src="https://s3.cointelegraph.com/uploads/2024-10/01927cea-e362-719e-9264-bf7a7bac44b3" title="">
 <figcaption style="text-align: center;">
 Source: <a data-ct-non-breakable="null" href="https://x.com/SenatorHagerty/status/1844563650087981486" rel="noopener noreferrer nofollow" target="_blank" text="null" title="https://x.com/SenatorHagerty/status/1844563650087981486">Senator Bill Hagerty</a>
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In addition, the bill changes the federal agencies that supervise some issuers. Hagerty said:
<blockquote>
 “These key provisions and other technical modifications strengthen the state pathway to stablecoin issuance, establishing a tailored regulatory regime that most effectively facilitates innovation and protects consumers.”
</blockquote>
The 2023 stablecoin bill&nbsp;<a data-ct-non-breakable="null" href="https://cointelegraph.com/news/payment-stablecoins-keep-your-coins-act-pass-house-committee" rel="null" target="null" text="null" title="null">passed out of the House</a>&nbsp;Financial Services Committee with bipartisan support, but negotiations continued. Committee ranking member Maxine Waters&nbsp;<a data-ct-non-breakable="null" href="https://democrats-financialservices.house.gov/news/documentsingle.aspx?DocumentID=412733#:~:text=Press%20Releases-,Ranking%20Member%20Waters%20to%20Chairman%20McHenry%20at%20Hearing%20with%20Securities,and%20Other%20Long%20Overdue%20Bills.%E2%80%9D" rel="noopener noreferrer nofollow" target="_blank" text="null" title="null">released</a>&nbsp;a statement in September expressing her satisfaction with the bill:
<blockquote>
 “Before the end of this year, I want us to strike a grand bargain on stablecoins and other long overdue bills. Since 2022, we have been working for hours on end to reach an agreement and have each made concessions.”
</blockquote>
Waters went on to stress the important role of the Federal Reserve Board in supervising stablecoins.&nbsp;
<figure>
 <img alt="Sen. Hagerty introduces Clarity for Payment Stablecoins Act of 2024" src="https://s3.cointelegraph.com/uploads/2024-10/01927ce8-ffd7-7904-8a92-655e9d52aef5" title="">
 <figcaption style="text-align: center;">
 Sen. Hagerty’s draft stablecoin legislation. Source: <a data-ct-non-breakable="null" href="https://www.hagerty.senate.gov/wp-content/uploads/2024/10/Stablecoin-Draft-Text.pdf" rel="noopener noreferrer nofollow" target="_blank" text="null" title="https://www.hagerty.senate.gov/wp-content/uploads/2024/10/Stablecoin-Draft-Text.pdf">Bill Hagerty</a>
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Related:&nbsp;<a data-ct-non-breakable="null" href="https://cointelegraph.com/news/a16z-executive-regulatory-clarity-needed-stablecoins-avoid-ftx-level-issue" rel="null" target="null" text="null" title="null">a16z&nbsp;exec: Stablecoin regulatory clarity needed to avoid ‘FTX-level issue’</a>
<h3 id="not-the-lone-voice-onstablecoins">Not the lone voice on&nbsp;stablecoins</h3>
Hagerty introduced the Stablecoin Transparency Act in 2022, during the previous Congress. That bill notably&nbsp;<a data-ct-non-breakable="null" href="https://cointelegraph.com/news/us-senator-toomey-introduces-stablecoin-bill-as-congressional-session-wraps-up" rel="null" target="null" text="null" title="null">defined stablecoins as securities</a>, which the 2024 bill explicitly does not. The Stablecoin Transparency Act did not make it out of the Senate Committee on Banking, Housing, and Urban Affairs.
<figure>
 <img alt="Sen. Hagerty introduces Clarity for Payment Stablecoins Act of 2024" src="https://s3.cointelegraph.com/uploads/2024-10/01927ceb-c5c9-7dbd-9613-65ba2bd6c317" title="">
 <figcaption style="text-align: center;">
 Source: <a data-ct-non-breakable="null" href="https://x.com/gillibrandny/status/1780567473386909881" rel="noopener noreferrer nofollow" target="_blank" text="null" title="https://x.com/gillibrandny/status/1780567473386909881">Sen. Kirsten Gillibrand</a>
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</figure>
Pro-crypto senators Cynthia Lummis and Kirsten Gillibrand&nbsp;<a data-ct-non-breakable="null" href="https://cointelegraph.com/news/stablecoin-bill-united-states-senate-lummis-gillibrand" rel="null" target="null" text="null" title="null">introduced stablecoin legislation</a>&nbsp;in April 2024.
At 179 pages, their Lummis-Gillibrand Payment Stablecoin Act is more than triple the length of McHenry’s and Hagerty’s bills. The Lummis-Gillibrand bill is still being considered by the Senate Committee on Banking, Housing, and Urban Affairs.
Hagerty is accepting comments on his draft bill through Nov. 1.
Magazine:&nbsp;<a data-ct-non-breakable="null" href="https://cointelegraph.com/magazine/peter-mccormack-new-podcast-what-bitcoin-did-mccormack-show/" rel="null" target="null" text="null" title="null">‘Everything feels like it’s going to shit’: Peter McCormack reveals new podcast</a>

Sen. Hagerty introduces Clarity for Payment Stablecoins Act of 2024

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