Members of the House of Representatives are working to get a stablecoin bill together for a markup meeting next Wednesday.
Democrats of the House Financial Services Committee are holding a member call this afternoon on the coming bill, sources with knowledge of the matter tell The Block. They have, it seems, agreed on core principles with their Republican colleagues but have not yet assembled text.
The members are planning to get the legislation ready and public in time for a markup on Wednesday, July 27.
Jake Sherman of Punchbowl News originally reported today's briefing, as well as the Democrats' plan to share draft text with Republicans on Friday.
As of today, however, sources with knowledge of the matter tell The Block that not even the Dems have seen any text. The core principles seem to be that, contrary to the Treasury-led President's Working Group report from last November, the Democrats don't intend to limit stablecoin issuance to insured depository institutions, or IDIs, which are mostly banks.
The Block reported that the committee had turned against this guidance as early as February, despite a draft bill from member Josh Gottheimer aiming to codify a similar regime. However, the new draft will likely limit bank-like lending to IDIs.
The US Treasury itself has apparently brokered the bipartisan deal, despite earlier attempts to downplay the challenges of an IDI regime. One person familiar with the matter said that the Securities and Exchange Commission is displeased with the Treasury Department, as the view of the commission has become that stablecoins are all money market funds.
Though the legislation is not expected to tackle algorithmic stablecoins, the collapse of Terra last month was apparently a catalyst for further work. With midterm elections approaching and few legislative days left in the current Congress, however, the chances that the bill will make it into law this time around seem nil — unless another catastrophe returns the issue to the top of the agenda.
Members of the staffs of Maxine Waters and Patrick McHenry — the leading Democrat and Republican on the committee, respectively — did not return requests for comment as of press time.
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