The House Subcommittee on Digital Assets, Financial Technology, and Inclusion & Capital Markets, has scheduled a hearing to address stablecoins – digital assets which are tied to another asset such as fiat currency. The Subcommittee is part of the House Financial Services Committee.
Chaired by Representative French Hill, the Subcommittee on Digital Assets and Fintech is a new subcommittee added after House Republicans took over the Financial Services Committee.
The hearing is scheduled to take place on Wednesday, April 19, 2023, starting at 10 AM. The meeting is entitled: Understanding Stablecoins’ Role in Payments and the Need for Legislation.
While stablecoins tend to be lumped into the broader universe of crypto, these digital assets are more akin to updated payment rails. By using new technology, stablecoins can enable payments and transfers by businesses and individuals with reduced cost and heightened security. Mainly used as on/off ramps for crypto markets, stablecoins could represent a significant leap in managing value transfers if usage is expanded to the digital payments sector.
What is missing are new rules to regulate stablecoins, including the requirement for fully collateralized and audited assets – which is what the industry desires. Some believe new rules will incorporate a “banking lite” type charter, and others see it regulated similarly to payment firms. The Securities and Exchange Commission believes all digital assets are securities (minus Bitcoin) – to the frustration of stablecoin issuers.
No details are available yet as to who is expected to testify, as well as any draft legislation, but this information should be forthcoming in the next several days.
The hearing will be live-streamed on the Commitee’s website.