The Digital Chamber, a blockchain advocacy group, has called on the United States to pass the Stablecoin bill as global adoption grows. According to the group’s statement, stablecoin use is on the rise globally, and lawmakers need to pass legislation to oversee its use in financial transactions.
Pushing for Stablecoin Legislation
The Digital Chamber has highlighted the need for US legislative action to preserve the dollar’s dominance in this market, hence its call for adequate regulation of this sector. Key members of the Senate Banking and House Financial Services Committees, as well as representatives from the Federal Reserve and the Office of the Comptroller of the Currency, have been scheduled to meet with Chamber leaders this week.
The Digital Chamber’s president, Cody Carbone, pointed out that the foundation has already been established, and American lawmakers only need to build on it. Notably, nations like China and Russia are also investigating ways to incorporate stablecoins into their economies, which could threaten the dominance of the US dollar in international banking.
According to Carbone, more than 98% of stablecoins in use are based on the US dollar. Hence, he argued that stablecoin laws are significant in supporting the dollar’s position in this developing market.
Current Landscape of Stablecoin Bills in Congress
Meanwhile, the US Congress is currently considering three legislation that would provide regulatory frameworks for the issuance and supervision of stablecoins. The Senate is now debating two of these proposals, while the House of Representatives is moving forward with the third.
Notably, the House Financial Services Committee has made great strides, with Democrat Maxine Waters and Chair Patrick McHenry leading the charge. However, there has been a setback regarding the plan, particularly the clauses that would grant state regulators the authority to approve stablecoin issuances without consulting the Fed.
At the Senate level, Senators Cynthia Lummis and Kirsten Gillibrand have proposed a stablecoin bill that lays out a regulatory framework with a focus on market safety and innovation. The Chamber’s study has made its recommendations, including suggestions from Nic Carter, a partner at Castle Island Ventures.
These recommendations support, among other things, letting banks and non-bank organizations create stablecoins but ensuring they aren’t categorized as securities and require 1:1 asset backing.
When combined, these clauses seek to establish a thorough and equitable regulatory framework that protects investors and permits the stablecoin market to expand responsibly.
Growing Demand for Stablecoin Regulatory Clarity
Meanwhile, Tether, the world’s largest issuer of dollar-backed stablecoins, has minted $5 billion in USDT over the past week, which has coincided with Bitcoin’s sharp price rise. After Tether’s initial $1 billion issuance on November 6, Bitcoin hit a record high of $76,200.
Additional issuances saw the leading cryptocurrency surpass the $80,000 threshold. Tether’s market value has recently increased to around $124 billion, highlighting the significance of stablecoins in preserving liquidity and enabling smooth transactions on centralized and decentralized platforms.
Furthermore, USDT is one of the most traded assets in the cryptocurrency ecosystem, with its 24-hour trading volume approaching $289 billion. The historical pattern in which rises in USDT supply correspond with the increase in prices of major digital assets like Bitcoin and Ethereum further supports the function of stablecoins in bolstering investor confidence and market activity.
Tether’s Network Expansion
In addition to its recent USDT issuance, Tether has also unveiled technological advancements to boost developments in decentralized finance. For instance, the company released an open-source wallet development kit (WDK) to facilitate the integration of non-custodial wallets for developers, companies, and new digital platforms,
Thus, users can create sophisticated, safe desktop, mobile, and web wallets that give them greater control over their assets without the need for centralized intermediaries. Tether’s suite of programming tools, which It refers to as a “super-modular, highly scalable” toolkit, embodies the company’s vision of a future in which asset holders have complete ownership over their digital assets.
Tether’s WDK also allows developers to design applications that promote a decentralized economy and enable smooth financial transactions.
