Tag: stablecoin bill

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Democrats Split Again As Stablecoin Bill Passes House Financial Services

stablecoin bill

With the first day of House Financial Services (HFS) Committee markups in the books, Day 2’s roster of bills for markup featured H.R. 4766, the “Clarity for Payment Stablecoins Act of 2023.”

And with Chair Patrick McHenry (R, NC) and Ranking Member Maxine Waters (D, CA) negotiating the night before over federal versus state jurisdiction according to Rep. Ritchie Torres (D, NY), an HFS member, there was some question as to whether the stablecoin bill would be ready for today’s hearing or would have to be postponed until the Fall.

See hearing page with video stream.

But after a marathon, 12-hour hearing that included rancorous debate and a parliamentarian’s delight of rules and rulings, the stablecoin bill passed by a tally of 34-16 with five Democrats splitting from Democratic leadership and joining all of the Committee’s Republicans.

Democrats voting for the bill included:  Rep. Gregory Meeks (NY), Rep. Jim Himes (CT), Rep. Josh Gottheimer (NJ), Rep. Ritchie Torres (NY) and Rep. Wiley Nickel (NC).

Himes, Gottheimer, Torres and Nickel also voted to pass yesterday’s market structure bill, too.

opening remarks

From the start, the markup for the stablecoin bill was a steady stream of lawmaker fireworks.

Chair McHenry began by explaining his frustration that even though the new bipartisan version of the stablecoin bill was nearly ready, the White House was not helping move the negotiation to the next step.

After completing his opening remarks, he passed the baton to Ranking Member Waters who asked for a quorum which was a way to use Congressional rules and shutdown the hearing given the lack of attendance by Committee members at the time.

Republicans scrambled and delivered the quorum. Continue reading “Democrats Split Again As Stablecoin Bill Passes House Financial Services”

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Bipartisan Stablecoin Bill Update From Reps. French Hill And Jim Himes Shows Progress

Atlantic Council

In a conversation with the Atlantic Council webcast earlier today, a bipartisan update on the stablecoin bill was provided by Rep. French Hill (R, AR), Chair of House Financial Services’ (HFS) Subcommittee on Digital Assets, Financial Technology and Inclusion, and Rep. Jim Himes (D, CT), a member of the HFS Committee and also Ranking Member of the House Permanent Select Committee on Intelligence.

The discussion was led by the Atlantic Council’s Josh Lipsky and Ananya Kumar. See the interview here.

Click below (or scroll down) for several highlights from the 50-minute conversation:

The following transcript has been lightly edited for clarity.

on addressing commingling

REP. FRENCH HILL (R, AR):  “We’ve seen a lot of digital asset players that are holding themselves out as an exchange. Or, they’re creating digital assets or trying to build their digital ecosystem where they produce their own stablecoin and effectively make a market in it – where nobody knows what the value of it is, how it’s characterized, how it’s overseen.”

“And that was a big challenge in the FTX collapse. People loaned against something they didn’t even understand the value of -including a lot of sophisticated players too. So yes, it’s gonna rival the losses back in the dotcom boom when it’s all said and done. We tried to address that by defining first and foremost what is stable? How is it defined? They have to have an audit. They have monthly attestation. They have exposure of their liquidity. This is something that’s not the case in stablecoins today.” Continue reading “Bipartisan Stablecoin Bill Update From Reps. French Hill And Jim Himes Shows Progress”

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House Democrats Unify Against Current House Stablecoin Bill

Stablecoin Hearing

Stablecoins finally had their hearing as the House Financial Services (HFS) new Subcommittee on Digital Assets, Financial Technology and Inclusion gathered at the Rayburn House office building for “Understanding Stablecoins’ Role in Payments and the Need for Legislation.”

The hearing proved that, for the most part, bipartisanship on Capitol Hill has rapidly dissolved on digital assets legislation. Furthermore, it appears Democrats have unified around an anti-crypto positioning. Rep. Ritchie Torres (D, NY) and Rep. Wiley Nickel (D, NC) may be the only exceptions among those who spoke during the Subcommittee’s hearing.

The prospects for new United States digital assets regulation – other than enforcement of current securities and commodities laws – could be closed for this Congress.

the hearing

The HFS memorandum for the hearing set the stage with a definition of stablecoins: “Stablecoins are a class of digital assets designed to offer price stability by being pegged to another asset’s value.” And, a witness list of mostly pro-crypto, industry representatives provided the input on not only the stablecoin and digital asset industry, but on the new stablecoin bill (PDF) first revealed over the weekend.

witnesses:

    • Adrienne Harris, Superintendent, New York State Department of Financial Services (prepared testimony – PDF)
    • Dante Disparte, Chief Strategy Officer and Head of Global Policy, Circle (PDF)
    • Austin Campbell, Adjunct Assistant Professor of Business, Columbia Business School (PDF)
    • Jake Chervinsky, Chief Policy Officer, The Blockchain Association (PDF)
    • Delicia Reynolds Hand, Director, Financial Fairness, Consumer Reports (PDF)

opening statements

Subcommittee Chair Rep. French Hill (R, AR) started the hearing off with his own opening comment reaffirming the interest of the HFS Committee to introduce a stablecoin bill emanating from the last Congress “when the clock ran out.” Hill named the bill “Maxine McHenry” after the Ranking Member Rep. Maxine Waters (D, CA) and Chair Rep. Patrick McHenry (R, NC).

As Hill reviewed the bill, he said that it would inhibit any possibility of a “run” and urged Members to move quickly thereby encouraging innovation, protecting consumers and move toward bringing clarity for digital assets beginning with stablecoins.

Subcommitee Ranking Member Rep. Stephen Lynch (D, MA) reviewed the need for stablecoins in his opening statement and then dropped a bomb. He suggested it’s worth reviewing whether stablecoins are even needed in wake of FedNow and a Central Bank Digital Currency. And then he revealed his disapproval of the bill given it was made pre-FTX implosion and listed his significant reservations. This was surprising – this bill had been driven by Ranking Member Waters, in part.

After a brief statement by Chair McHenry, Ranking Member Waters then spoke and clarified the Democratic position saying that the bill posted was no longer relevant given events at the end of last year (FTX), needed to be renegotiated and expressed disappointment in the way the bill has been pushed by Republicans. Continue reading “House Democrats Unify Against Current House Stablecoin Bill”