With the introduction of Representatives Cynthia Lummis and Kirsten Gillibrand’s latest stablecoin bill and Congresswoman Maxine Waters’ resurgence in support for stablecoin legislation, the question arises: Is imminent enactment of a new law governing cryptocurrencies on the horizon?
Cody Carbone, Chief Policy Officer at The Digital Chamber, expressed his skepticism last week, indicating that he would only assign a 35% chance of any stablecoin legislation passing before the U.S. presidential election.
Carbone Expresses Doubt Regarding Passage of Stablecoin Bill Before Presidential Election
“In an interview with Crypto News on Thursday, Carbone remarked, ‘It’s not entirely improbable, but I believe it’s more probable than not that it won’t pass. There’s motivation among people, which gives me some glimmer of hope.'”
“At present, the Clarity For Payment Stablecoins Act by House Financial Services Chairman Patrick McHenry and the recently introduced Lummis-Gillibrand Payment Stablecoin Act stand as the two primary pieces of stablecoin legislation under consideration in Congress.”
🚨@gillibrandny and I are introducing the most comprehensive stablecoin bill to date.
Crypto assets are revolutionizing the world and as the undisputed leader in financial innovation, the U.S. must embrace crypto assets, but it cannot be done without clear rules for stablecoins. pic.twitter.com/vwRUEBUdsl
— Senator Cynthia Lummis (@SenLummis) April 17, 2024
If passed, the bill proposed by Lummis and Gillibrand would authorize regulatory supervision of cryptocurrencies at both the state and federal levels, while McHenry’s bill would permit non-bank stablecoin issuers to remain subject to state regulation. This issue has emerged as a significant source of disagreement among U.S. lawmakers.
Carbone remarked, “This aspect has proven to be the most contentious hurdle in reaching a consensus, and I haven’t observed any advancement in resolving it. That’s why I’m pessimistic about the prospects of achieving a resolution.”
Maxine Waters, Cynthia Lummis, and Other Representatives Advocate for Stablecoin Reform
Carbone emphasizes that the momentum behind the drive for comprehensive stablecoin reform is entering a crucial phase in the coming weeks. As representatives race against the clock to finalize legislative agendas before retreating to their respective partisan corners and gearing up for potential re-election campaigns, the window of opportunity for enacting meaningful regulatory measures is rapidly closing.
On Capitol Hill, representatives are scrambling to propel their cryptocurrency-related bills forward. Earlier this month, reports surfaced indicating that Waters and McHenry had presented their forthcoming stablecoin bill to Senator Chuck Schumer, underscoring the urgency and intensity surrounding efforts to address the regulatory challenges posed by stablecoins.
California Rep. Maxine Waters, the top Democrat on the House Financial Services Committee, says the panel is on the way to getting a stablecoin bill in the short run https://t.co/T8XCD3XWMt pic.twitter.com/PGrNLBWA0g
— Bloomberg TV (@BloombergTV) April 24, 2024
As per reports from Punchbowl News, McHenry and Waters engaged in discussions regarding the possibility of attaching their proposed stablecoin reform measures to the forthcoming must-pass funding reauthorization of the Federal Aviation Administration (FAA). This strategic maneuver aims to garner bipartisan support for their respective initiatives by piggybacking on the imperative nature of the FAA reauthorization.
However, a significant obstacle looms in the form of Senator Elizabeth Warren, whose staunch opposition to any regulatory framework for cryptocurrencies, particularly in the absence of her Digital Asset Anti-Money Laundering Act (DAAMLA), poses a formidable challenge. Warren’s steadfast advocacy for stringent regulatory measures underscores the complexity and contentious nature of the stablecoin regulatory landscape.
Carbone emphasizes the necessity for collaboration and consensus-building among lawmakers, stressing that ultimately, a unified approach is indispensable for advancing stablecoin legislation that can successfully navigate the legislative process and secure presidential approval.
With all eyes fixed on Washington, D.C., in the ensuing weeks, the fate of stablecoin legislation hangs in the balance. The spotlight intensifies as U.S. lawmakers grapple with the formidable task of reconciling divergent perspectives and crafting legislation that strikes a delicate balance between regulatory oversight and innovation in the cryptocurrency sphere. As the countdown to the November 2024 elections begins, the urgency to broker compromises and forge consensus on stablecoin regulation becomes increasingly palpable.
