Hagerty Releases Discussion Draft of Comprehensive Stablecoin Legislation

October 10, 2024

WASHINGTON—United States Senator Bill Hagerty (R-TN), a member of the Senate Banking Committee, today released a discussion draft of legislation that establishes a clear regulatory framework for the regulation and supervision of stablecoin issuers.

“Stablecoins have the potential not only to enhance transactions and payment systems, but also to help create new demand for U.S. Treasuries as we work to address our unsustainable deficit,” said Senator Hagerty. “For too long, these benefits and the broader promise of stablecoins have been hindered by the lack of clear regulations. My draft legislation provides much-needed clarity, putting in place the legal framework necessary to unlock this technology’s full potential for the benefit of Americans.”

Senator Hagerty’s discussion draft builds upon the Clarity for Payment Stablecoins Act, introduced by House Financial Services Committee Chairman Patrick McHenry. Senator Hagerty’s bill exempts issuers of less than $10 billion in total stablecoin from federal regulation, allowing them to remain under the oversight of state regulators. Issuers exceeding the $10 billion threshold may seek a waiver from their applicable federal regulator to stay under state regulation. Additionally, the legislation designates the Federal Reserve as the supervisor of issuers that are depository institutions and makes the Office of the Comptroller of the Currency the supervisor of federally qualified nonbank issuers.

These key provisions and other technical modifications strengthen the state pathway to stablecoin issuance, establishing a tailored regulatory regime that most effectively facilitates innovation and protects consumers.

Please submit feedback on the discussion draft to matt_venoit@hagerty.senate.gov by November 1.

Read the full text of the draft legislation here.

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