During an April 19 hearing of the U.S. Subcommittee on Digital Assets, Financial Technology, and Inclusion, lawmakers deliberated on the role of stablecoins in the country’s financial landscape. However, some experts expressed concern regarding the United States’ regulatory environment.
Austin Campbell, an adjunct assistant professor at the Columbia Business School, highlighted that jurisdictions such as Singapore, Dubai, Abu Dhabi, and the United Kingdom have already proposed frameworks for stablecoins, potentially offering a more competitive regulatory environment for issuers.
Campbell emphasized the need for the U.S. to take action, stating, “If we don’t act, those are the best options, and people will take advantage of them.” He further noted that when advising stablecoin projects, he now recommends avoiding U.S. operations and domicile, as jobs are moving elsewhere.
Committee members express concerns over proposed stablecoin legislation in the U.S.
Committee members also expressed concerns over proposed stablecoin legislation in the United States. House Financial Services Committee Chair Patrick McHenry introduced a discussion draft bill on how Congress could address stablecoins used for payments and a central bank digital currency.
Ranking member Maxine Waters, however, asserted that the published draft did not represent a compromise between Democratic and Republican party members and urged further negotiations.
Major stablecoins such as Tether (USDT) and USD Coin (USDC) have experienced temporary de-pegging from the dollar due to various market forces. Meanwhile, proposed bills from some U.S. lawmakers have suggested banning algorithmic stablecoins like TerraUSD Classic (USTC), which lost its peg to the U.S. dollar in May 2022.