"Hmm, is it possible that the approved stablecoin legislation will have a positive impact on the crypto market?"
Federal Reserve (Fed) Chairman Jerome Powell during a recent congressional hearing expressed his deep interest in passing stablecoin legislation before the end of 2024 in response to a question from Representative Wiley Nickel.
The commitment outlines the need to establish a legal framework for the provision of stablecoin services to increase the stability and security of transactions in the United States (US).
Proposed by Senators Cynthia Lummis and Kirsten Gillibrand in April 2024 as a comprehensive bill to regulate payment stablecoins, the Lummis-Gillibrand Payment Stablecoin Act aims to regulate the crypto market that will protect consumers.
According to the new bill, a payment stablecoin is a designed digital asset used as a medium of exchange or means of payment that is redeemed for a fixed amount of US dollars or a stable value equivalent to US dollars.
It is true that many hailed the introduction of the bill as a way to bring sanity to the crypto market and protect users, but some raised concerns about the possible negative impact on innovation.
Not only that, the proposed stablecoin regulation also raises questions about its impact on First Amendment rights where Coin Center opposes the bill claiming that the ban on algorithmic stablecoins is problematic.
Despite some concerns about how the bill will affect innovation and speech, Coin Center Chief Executive Officer (CEO) Berry Brito praised the government's efforts to regulate stablecoins.
