The American Bankers Association (ABA) has urged lawmakers to regulate stablecoin issuers like banks, arguing that two bills on the subject, up for debate this week, "fall short".
On Thursday, the House Financial Services Subcommittee on Digital Assets, Financial Technology and Inclusion debated two bills on stablecoin regulation, one brought by committee chairman Patrick McHenry and the other by ranking member Maxine Waters.
The ABA says that while it supports parts of both bills, they fall short in several areas.
Specifically, McHenry's does not include financial stability as a factor that regulators must consider when evaluating payment stablecoin issuer applications. In addition, both bills offer a lack of public disclosure for issuers or requirements for third-party audits of reserves.
Says the ABA in a letter: "Stablecoin issuers behave in many instances like a bank in that they facilitate payments, connect to investment platforms and store value...Applying the principle of ‘same activity, same risk, same regulation’ will help ensure that all customers are protected equally, regardless of where they engage with the financial marketplace and that the financial system remains strong, safe and competitive."