The House Financial Services Committee, chaired by French Hill of Arkansas, recently conducted a hearing to discuss the potential establishment of a federal framework for payment stablecoins and the implications of a U.S. Central Bank Digital Currency (CBDC). The hearing focused on blockchain technology's role in payments via stablecoins and examined how the proposed STABLE Act could affect issuers, consumer protection, competition, and innovation. The committee also addressed concerns regarding a government-controlled CBDC and Republican efforts to prevent its implementation.
Chairman Hill emphasized the importance of regulating the stablecoin market effectively: “A properly regulated stablecoin market can strengthen the U.S. dollar’s dominance, modernize our payments infrastructure, and promote financial access without government overreach. It is essential that we are deliberate and get this job done and done right.”
House Majority Whip Tom Emmer from Minnesota expressed his concerns about CBDCs: “I’m grateful to this committee for noticing my bill, the Anti-CBDC Surveillance State Act, in this hearing today. The bill is simple. It halts the effort of unelected bureaucrats from ever issuing a Central Bank Digital Currency that could upend the American way of life. …CBDC’s introduce significant privacy risks and are fundamentally the antithesis of American values.”
Rep. Bill Huizenga from Michigan highlighted stablecoins' potential benefits: “Stablecoins hold immense potential... The capacity to simplify our payment system is going to be huge... There is a moment here for us in Congress to act. As legislators it is ultimately up to us to provide the regulatory clarity needed to ensure that the U.S. dollar remains the dominant reserve currency, and I believe stablecoins can do that.”
Rep. Timmons from South Carolina stressed the need for clear regulations: “A strong legislative framework will give entrepreneurs and investors and businesses the certainty they need to innovate without fear of regulatory overreach or shifting political agendas. Without clear laws, the digital asset industry remains vulnerable to arbitrary enforcement actions that stifle growth and push talent overseas.”
Caroline Butler from The Bank of New York Mellon Corporation supported federal regulation: “In the absence of a unified federal framework governing stablecoins, participants in stablecoin arrangements look to various state and federal laws... We commend this Committee for its work to develop a targeted federal framework...”
Charles Cascarilla from Paxos praised Chair Hill's efforts on digital finance leadership: "I want to thank Chair Hill and Representative Steil personally for their work to develop the STABLE Act... Stablecoin issuers like Paxos do not take deposits or make loans; we facilitate payments..."
Patrick Collison from Stripe urged quick action on global standards: “We see other countries (e.g., in Europe) already putting their legal frameworks into motion... The U.S. should move quickly..."
Randall Guynn from Davis Polk & Wardwell commented on historical regulatory frameworks: “The proposed regulatory framework for payment stablecoins appears to have been modeled on... principles that if it ain’t broke, don’t try to fix it..."