The US House Financial Services Committee has made progress in regulating stablecoins. The “Clarity for Payments Stablecoin” bill has been thoroughly debated and reviewed, and stablecoins currently hold a 10% stake in the conversation.
Following an extensive 13-hour markup session, the bill made significant progress, becoming the second primary crypto legislation to be approved by the Committee within the same week. A well-known Journalist in the crypto industry, Eleanor Terrett, tweeted.
🚨NEW: After 13 hours of markup, the Clarity for Payments Stablecoin bill has passed the @FinancialCmte with a 34-19 vote, making it the second major piece of #crypto legislation to pass the Committee this week. https://t.co/OlsTUH1O5f
— Eleanor Terrett (@EleanorTerrett) July 28, 2023
Five Democrats, including Representatives Himes, Gottheimer, Meeks (D-NY), Torres, and Nickel, stood as supporters of the bill. Notably, Representative Meeks’ endorsement holds significance since he had recently expressed his backing for a broader crypto legislation.
Throughout the legislative process, the “Clarity for Payments Stablecoin” bill encountered obstacles. Representative Maxine Waters, the lead Democrat on the committee, expressed concerns regarding its contents. She emphasized what she perceived as significant flaws, notably a potential loophole that could allow commercial entities like Elon Musk’s Twitter X to issue their own cryptocurrency.
Congress Navigates Stablecoin Bill Amid Twitter X Coin Fears
Musk’s recent rebranding of Twitter X as an “everything app” with plans for incorporating payment features further fueled speculations. These speculations are about the possibility of a “Twitter Coin” like the rumored “X Coin.”
Negotiations between Democrats led by Rep. Waters and Republicans led by Rep. Patrick McHenry, the committee’s chairman, appeared to be at an impasse for some time. Nonetheless, the Republicans persuaded certain Democrats to rally behind the bill, leading to a bipartisan agreement.
Both sides of the aisle voiced apprehensions about coins created by tech giants, notably Elon Musk’s Twitter X Coin. Rep. Waters expressed concern about Twitter X Coin potentially becoming a global payments provider through the issuance of a stablecoin, a scenario she deemed “a frightening proposition.”
The White House’s 2021 report entered the debate and recommended restricting stablecoin issuance to federally regulated banks. This stance addresses concerns about economic power concentration and systemic risks associated with stablecoins. However, despite these fears, the bill successfully cleared the committee, offering a glimmer of hope for the US crypto industry. This industry is eagerly anticipating a clear regulatory framework.
As the “Clarity for Payments Stablecoin” bill progresses, the cryptocurrency market maintains its sideways trend, currently valued at $1.142 trillion. With the bill advancing, the US is one step closer to potentially establishing a comprehensive regulatory framework for stablecoins.
Despite the lingering apprehensions surrounding tech giant involvement, people are making this progress. As the legislative process continues, stakeholders in the crypto industry eagerly await further developments. They anticipate potential amendments that will shape the future of stablecoins in the country.