USDC issuer Circle lays out its hopes for coming stablecoin policy

Quick Take

  • As Congress mulls stablecoin legislation, Circle is laying out its wishlist. 
  • Dante Disparte, the stablecoin issuer’s CSO, put out a set of 19 principles for coming policy. 

Dante Disparte, the leader of Circle's government work, on July 18 published a set of 19 principles for stablecoin regulation, as part of the company's efforts to shape US stablecoin policy.

The principles are fairly familiar to those following the debate over stablecoin issuance, particularly the requests that the industry has been making: privacy, continued issuance by non-banks, and co-existence alongside a potential central bank digital currency.  Circle issues USDC, which has a total supply of $45 billion, making it the second-largest stablecoin after Tether. 

Regarding the non-bank issuance — a sticking point in policy discussions — Disparte wrote: 

"The preservation of bank and non-bank dollar digital currency issuance promotes competition, a level playing field, and rules-based upgrades in the financial system. Bank-like risks should be addressed with scale-appropriate bank grade levels, including asset liability management, operational and enterprise risk management considerations."

Disparte testified before the Senate on the subject of stablecoins in December. At the time, he  already was advocating for a similar multi-pronged approach to stablecoin regulation, which the industry has largely asked for. In contrast, the Treasury has pushed to limit issuance to "insured depository institutions," which are generally banks. Circle CEO Jeremy Allaire also has been a familiar figure in Congressional hearings on crypto.

Circle recently joined Paxos as stablecoin issuers that disclose the specific Treasury securities they hold in reserves. Alongside cash, short-term T-bills have become a standard acceptible reserve for fiat-backed stablecoins.  

Disparte had been involved in the committee handling government affairs for Facebook's unsuccessful Diem, formerly known as Libra, stablecoin project. 

A representative for Circle had not returned a request for comment as of publication time. 

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