CryptoLink - June 2023

Both stablecoin and market structure legislation remain the focus for two distinct paths forward in the digital assets space. The House Financial Services Committee is continuing to focus on digital assets. Chairman of the Committee Patrick McHenry (R-NC) mentioned earlier in the year that he wanted to pass stablecoin and market structure legislation this summer. In order to hit this target, the Chairman and his partner at the House Agriculture Committee have put forward two pieces of draft legislation. Chairman McHenry intends to “markup” the bills in his committee when Congress returns from its July 4 recess. It remains unclear what the fate of these bills will be. Although there is some bipartisan support in the House for both stablecoin and market structure legislation, the House Financial Services Committee’s lead Democrat, Ranking Member Maxine Waters, appears to be much more open to a regulatory framework for stablecoins. She recently sent letters to the Department of the Treasury and the SEC, asking for comments on the proposed market structure bill. We know that the answer from SEC Chairman Gary Gensler will be hostile. By contrast, the Administration and Federal Reserve Chair Jay Powell seem much more open to a stablecoin framework, and it is telling that Ranking Member Waters did not ask for input on the stablecoin draft.