March 27, 2024
Policy & Regulation

Pro-Bitcoin U.S. Senator Lummis Shapes Stablecoin Rules

In a significant move for the cryptocurrency industry, U.S. Senator Cynthia Lummis, a prominent advocate for Bitcoin, is collaborating with Senator Kirsten Gillibrand on drafting regulations for stablecoins. Stablecoins are a type of cryptocurrency pegged to real-world assets to maintain stable prices.

According to a report from Axios on March 7, the senators have been working together for several months on a bill aimed at providing regulatory clarity for stablecoins and ensuring investor protection. The official announcement of this development is expected soon, following positive feedback from various stakeholders.

The New York Department of Financial Services, the Federal Reserve, the Treasury Department, and the National Economic Council have all contributed technical assistance to the Senate bill, emphasizing the collaborative effort to address this growing sector of the digital asset market.

Senator Lummis and Senator Kirsten Gillibrand at the DC Blockchain Summit in 2022. Source: Axios

This isn’t the first time Senators Lummis and Gillibrand have ventured into cryptocurrency legislation. Back in July 2013, they jointly announced an effort to reintroduce legislation for a comprehensive regulatory framework for digital assets.

Senator Lummis, known for her pro-Bitcoin stance, has actively championed the decentralized cryptocurrency. In October 2021, she urged the U.S. government to recognize the value of Bitcoin during discussions about raising the country’s debt limit.

Despite her support for Bitcoin, Senator Lummis has expressed skepticism about certain stablecoins, notably Tether, the largest stablecoin by market capitalization. In October 2023, she endorsed a campaign against Tether, urging the U.S. Justice Department to consider criminal charges against the stablecoin firm amid reports of alleged illicit financial transactions. Tether responded by expressing its commitment to being a “world-class partner” to U.S. regulators.

In her latest move, Senator Lummis has taken a stand against central bank digital currencies, arguing that they are “anti-democratic and a means of financial censorship.” This continued involvement and advocacy highlight the senators’ dedication to shaping the regulatory landscape for cryptocurrencies, balancing innovation with the need for consumer protection and market stability.

Image from Wikimedia Commons

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