$USDC

The Loomis-Gillibrand Stablecoin Act aims to regulate stablecoins in the United States, addressing concerns about major tech companies entering the payments space. Key provisions include¹²:

- *Issuance of Stablecoins*: Only financial institutions are allowed to issue stablecoins, excluding major tech companies like Meta, Google, Amazon, and X.

- *Reserve Requirements*: Stablecoin reserves must be held in cash, bank deposits, short-term Treasury bills, and certain types of repurchase agreements.

- *Regulatory Oversight*: The Federal Reserve and government regulatory bodies will oversee stablecoin issuers, while larger stablecoins will require more stringent regulatory rules.

- *Ban on Algorithmic Stablecoins*: The bill proposes a ban on algorithmic stablecoins due to concerns about their stability and potential risks.

The bill also addresses the treatment of stablecoin issuers in bankruptcy proceedings and requires custodial trustees to safeguard the reserves of smaller stablecoin issuers. Current stablecoin issuers, such as Circle, Paxos, and Gemini, may need to adapt to these new regulations.