Fifteen years ago Lehman Brothers collapsed, destroying the retirement savings of millions of Americans. Congress and the White House responded to the ensuing financial crisis by passing the Dodd-Frank Act, which was meant to strengthen the financial system and protect consumers.
Heath Tarbert, former Chairman of the Commodity Futures Trading Commission, is Chief Legal Officer at Circle. This op-ed is part of CoinDesk’s State of Crypto Week sponsored by Chainalysis.
Today, digital currencies are poised to upgrade America’s decades-old financial plumbing, bolster the U.S. dollar, and make it easier, faster, and cheaper for families and businesses to send, spend, lend, and exchange their money. But this can happen only if Washington unites behind payment stablecoin legislation that puts financial stability and consumer safety first.
Payment stablecoins are neither niche nor novel – they form an important new base layer for today’s payments and commerce, remittances and humanitarian aid. Their rapid growth reflects their everyday, real-world utility as digital dollars move globally at the speed and scale of the internet.
The positive impact of digital dollars can have an outsized impact in communities across the U.S. Working American families disproportionately bear the burden of the high-fees related to sending and spending their hard-earned money. Contrast wiring funds with sending a text message across the country. Have you ever paid $6 and waited three days to text a loved one?
The frictionless nature of stablecoins is helping to expand financial security and inclusion to vulnerable populations here and abroad who can’t easily access brick and mortar banking. The United Nations, for example, has begun sending humanitarian assistance in the form of stablecoins to Ukrainian refugees.
Congress is beginning to grasp the stakes. This summer, several committees advanced bills to better regulate the digital asset economy, including the Clarity for Payment Stablecoins Act, which the House Financial Services Committee approved on a bipartisan basis. The stablecoin measure serves as a vital foundation for the other bills.
Congress should pass that bill or another bipartisan measure that provides for the following:
- Strong supervision and risk management of stablecoin issuers
- Strict…
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