US House Delays Decision on Stablecoin Regulation Amid Ongoing Debate

The Delay Dilemma

It seems like the legislative process resembles a game of hot potato, at least when it comes to stablecoin regulation. Lawmakers in the House of Representatives have decided to postpone their decision regarding a stablecoin bill, now eyeing a possible vote in September, according to the Wall Street Journal. So, if you’re holding your breath for clarity about your crypto assets, you might want to exhale a bit.

What’s Holding Up the Bill?

Well, it turns out drafting a bill is not as easy as pie, especially with unresolved issues looming large. One of the hot topics at the moment includes provisions on custodial wallets as proposed by the Treasury Department. Additionally, the Securities and Exchange Commission (SEC) has expressed concerns that are making the whole process feel like a suspenseful thriller.

A Game of Tug-of-War

Treasury Secretary Janet Yellen has reportedly been engaging in a bit of a coordination dance with the Biden administration. Why? Because aligning their responses to this legislation is paramount. Both Yellen and Biden have previously shed light on the urgent need for regulatory clarity, especially following the unsettling depegging mess with TerraUSD (no, it’s not a new snack food!) from its dollar value.

“Glad to hear @SecYellen acknowledge the need for Congress to pass legislation that creates a sensible regulatory framework for stablecoins.” — Senator Pat Toomey

Past Attempts and Future Prospects

Let’s not forget the Stablecoin Innovation and Protection Act proposed by New Jersey Representative Josh Gottheimer earlier this year. This act, now a little dusty on the shelf, would have allowed the Federal Deposit Insurance Corporation (FDIC) to back stablecoins similar to how it backs traditional deposits. Meanwhile, the bipartisan bill from the Senate, courtesy of Cynthia Lummis and Kirsten Gillibrand, may not see the light of day until 2023. Talk about a long wait!

dation Fees?

Regulatory back-and-forth isn’t happening just in the U.S., though. While the U.S. lawmakers are stalling, their UK counterparts are strutting forward with their own legislation on stablecoins. It seems like they’ve got their act together—probably because they avoided stepping in the same regulatory mud pit we’re grappling with across the Atlantic.

A Broader Look at International Policies

The UK’s Department of Treasury is actively considering legalizing stablecoins for payment use. With Prime Minister Boris Johnson’s government witnessing a shakeup amidst resignations and scandals, you might think stablecoins would be the last thing on their minds. But no! It appears they’re all in—and that’s a refreshing brisk breeze compared to the legislative fog in the U.S.

Maybe it’s time for U.S. lawmakers to take a leaf out of the UK’s book—before their legislation finds itself shelved for the modern equivalent of dog years!