On February 9, at the just-concluded U.S. House of Representatives hearing, the House Financial Services Committee rejected the Treasury Department’s proposal to include stablecoin issuers in the banking system.
The Treasury Department proposed limiting stablecoin issuance to insured depository institutions or IDIs (institutions with FDIC insurance, most of which include banks).
The Financial Services Commission believes that the best regulation of stablecoins is not to copy the blunt tools of regulating banks, but through common-sense rules. And the current risk of stablecoins is lower than if Congress included them in the IDI framework, and the proposed regulatory form would limit competition and affect racial equality.