Failing to register as a stablecoin issuer could result in a five-year prison sentence and a $1 million fine. To operate in the country, issuers from outside the United States would need to apply for registration
A new draught bill offering a framework for stablecoins in the United States was published on the House of Representatives’ document repository on April 19, just days before a hearing on the subject. The draught puts the Federal Reserve in charge of non-bank stablecoin issuers such as crypto companies Tether and Circle, which issue Tether USDT, respectively.
Stablecoins are a type of cryptocurrency that attempts to provide price stability to investors by being backed by specific assets or using algorithms to adjust supply based on demand. The BitUSD, the first stablecoin, was released in 2014.
Furthermore, issuers must demonstrate technical expertise and established governance, as well as the benefits of providing financial inclusivity and innovation via stablecoins.
A two-year restriction on issuing, generating, or originating stablecoins that are not backed by actual assets is also included in the proposed legislation.
