On April 19, Coin Center, a prominent cryptocurrency advocacy organization, faced opposition to a Senate bill regarding stablecoins. Proposed by Senators Kirsten Gillibrand and Cynthia Lummis, the Lummis-Gillibrand Payment Stablecoin Act aims to regulate coins with values linked to traditional currencies like the US dollar.
Coin Center argues that ending a stablecoin’s operation is an unconstitutional move, according to their perspective. Defendants, however, maintain that this action does not fall under the protection of free speech as an expression, potentially infringing upon the balance between individual liberties and government power.
Although there’s agreement that regulation for algorithmic stablecoins is necessary, Coin Center proposes a two-year delay instead of immediate action, as suggested in another House bill. This stance aligns with statements made by Coin Center Executive Director Jerry Brito, advocating for legislation on stablecoin regulations in the US.
This week, the Lummis-Gillibrand bill was introduced with the goal of establishing regulations for stablecoins. This is commendable. However, it’s regrettable that this legislation includes a prohibition on “algorithmic payment stablecoins.” Such a ban could hinder innovation and potentially infringe upon free speech protections under the First Amendment.
— Jerry Brito (@jerrybrito) April 19, 2024
After the 2022 crypto market turmoil, which started with TerraUSD (UST) losing its dollar value connection, the importance of a risk associated with stablecoins was highlighted. To clarify, this incident caught the attention of the US Senate Banking Committee chairman, Sherrod Brown, who began exploring regulatory options for these digital currencies.
The Clarity for Payment Stablecoins Act, which is yet to be put to a final vote in the legislative body, is one contender. However, the status of the Lummis-Gillibrand Act remains undecided.
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2024-04-20 00:24