A key US House committee is expected to advance landmark stablecoin legislation, a priority of President Donald Trump and the crypto industry, according to two people familiar with the plans.
The Financial Services panel will consider the bill on April 2. The move comes as crypto’s clout in the US capitol has surged on bipartisan backing from key Democrats like Senator Kirsten Gillibrand of New York and record-setting campaign spending that helped defeat industry foes and elect allies.
Chairman French Hill of Arkansas said last week that a well-regulated stablecoin market would “strengthen the U.S. dollar’s dominance, modernize our payments infrastructure, and promote financial access without government overreach.”
Crypto companies, whose legislative agenda has long languished in the Capitol, have pitched stablecoins as a way to bring financial services to anyone with a phone, providing cheaper and faster global transactions than existing payment networks like credit cards, bank wires and ATM machines.
Dollar-based stablecoins bolster demand for US dollars and debt, because they are intended to be backed at least one-to-one with dollar-based assets, like short-term government debt or similar highly liquid reserves overseen by regulators. Stablecoin makes money by earning interest on those reserves.
But Maxine Waters, the top Democrat on the House committee, and Elizabeth Warren of Massachusetts, her counterpart on the Senate Banking Committee, have argued the measures do not adequately protect consumers. Both want a ban on tech companies like Elon Musk’s X or Meta Platforms Inc.’s Facebook issuing their own stablecoins as well as other changes.
Critics also worry about a lack of a backstop like FDIC insurance in case a stablecoin fails, while bankers have warned lawmakers about the potential for stablecoins to siphon off deposits and reduce access to credit.