The United States officially passes the stablecoin regulatory framework, opening a new era of cryptocurrency legislation.

On July 19, the President of the United States officially signed a landmark stablecoin regulatory bill, establishing the country's first federal-level stablecoin regulatory framework. This marks an important step for the United States in the field of Crypto Assets regulation and is the first cryptocurrency-related bill in the country to become law.

According to reports, the controversial issues of interest conflicts in certain family encryption projects did not pass the relevant amendments, and these provisions were not reflected in the final version of the bill.

Legal experts have pointed out that the bill provides incentives for stablecoin issuers to apply for banking licenses. The passage of the bill not only brings unprecedented new signals to the U.S. Crypto Assets industry, but also sparks widespread discussions in the industry about the future of stablecoin issuers and market competition.

Multiple Crypto Assets Executives Witness Bill Signing Ceremony

In the Crypto Assets industry, the regulation of stablecoins has always been a pending topic. This new bill, as the first federal regulatory framework for stablecoins in American history, provides a clearer regulatory direction for the US market, while also fulfilling the encryption commitments made to voters during the presidential campaign.

At the bill signing ceremony, the President stated: "This afternoon, we have taken a decisive step to solidify the United States' leadership in the global financial and encryption technology sectors, and we will sign this landmark legislation into law." He also added that this signing is a "huge recognition" of the Crypto Assets industry.

The signing ceremony was attended by founders and executives from several leading companies in the Crypto Assets industry, including the CEO of a well-known stablecoin issuing organization and the CEO of a major trading platform.

The White House AI and crypto chief stated in a promotional video, "The bill will update the outdated payment infrastructure with a revolutionary new payment system and will expand the dominance of the dollar globally."

This bill establishes a federal regulatory framework for stablecoins, requiring that stablecoins must be fully backed by U.S. dollars or similar liquid assets, stipulating that issuers with a market capitalization exceeding $50 billion must undergo annual audits, and setting guidelines for foreign entities issuing stablecoins. The bill will take effect 18 months after the President's signature, or 120 days after the primary federal payment stablecoin regulatory agency publishes the final regulations implementing the bill.

Controversy Arising from Dual Licensing Structure

Before the signing of the bill, several advocates from the Crypto Assets industry expressed their support. The founder of a stablecoin issuing organization posted on social media: "Heading to the White House to attend the historic signing ceremony of this bill, one of the most transformative pieces of legislation in decades. Global financial system, welcome to the internet!"

Some analysts believe that the bill may drive stablecoins to become mainstream by enhancing trust in currency and encouraging more competition in the market. They anticipate that as the bill provides a clear path for banks and other entities to issue stablecoins, a significant number of new stablecoins may emerge in the future.

However, the bill also faces some criticism. Critics argue that it may undermine the decentralization characteristics of Crypto Assets and could lead to corruption, such as officials favoring certain specific stablecoins under the new regulations.

Scholars have pointed out that this new legislation will authorize the Office of the Comptroller of the Currency (OCC) to regulate stablecoin issuers nationwide, but if the government is inclined to weaken the independence of regulatory agencies, it may pose potential risks.

In addition, the bill creates a dual licensing structure for some stablecoin issuers, allowing them to seek federal or state regulation. Some experts are concerned that this could lead to "race to the bottom" competition among different jurisdictions to attract Crypto Assets companies.

Bank licenses may become a new pursuit for stablecoin issuers

Some cryptocurrency lawyers have stated that the bill provides an incentive for stablecoin issuers to seek banking licenses. The stablecoin license established by the bill restricts a company's activities to "pure stablecoin issuance," but the business scope of most stablecoin issuers is far beyond that.

Even if the issuer obtains the license approved by the bill, they still need to obtain a state-level money transmission license to operate nationwide. This provides an incentive for stablecoin issuers to apply for a national trust bank license, as it would allow them to engage in the issuance of stablecoins and broader activities without the need to obtain licenses between states.

Some industry insiders believe that more entities may strive to become banks in the future. Becoming a bank may bring the following benefits: the ability to pay interest on stablecoin deposit accounts, direct settlement with the Federal Reserve, and having a broader range of business capabilities, among others.

However, the provision in the bill that prohibits stablecoin issuers from offering interest or returns to holders and users has sparked some controversy. This could impact the appeal of certain stablecoins, as offering returns is one of the important marketing strategies to attract users.

For decentralized finance (DeFi) platforms, the bill may bring some uncertainty. There may be more legislation and regulation in the coming years to fill these gaps.

Overall, the signing of this bill marks a new historical phase in the regulation of stablecoins in the United States. Although it has sparked controversy in some areas, it may also provide new opportunities for future stablecoin issuers. As the regulatory environment changes, the industry will closely monitor subsequent developments.