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Senator Cynthia Lummis proposes a stablecoin regulation bill

TL;DR

  • After criticizing Tether, Senator Cynthia Lummis is drafting stablecoin regulations to protect investors and ensure stability.
  • Teaming up with Senator Kirsten Gillibrand, they propose a bill for regulatory clarity after consulting with key agencies.
  • Despite backing Bitcoin, Lummis is skeptical of Tether and opposes central bank digital currencies due to fears of financial censorship.

Senator Cynthia Lummis, a prominent advocate for Bitcoin, spearheads efforts to draft regulations for stablecoins, a type of cryptocurrency pegged to real-world assets. This move comes after Lummis criticized major stablecoin firm Tether last year, signaling a shift in her stance toward regulating the digital asset landscape.

Drafting regulations for stablecoins

Senator Lummis and Kirsten Gillibrand have been working diligently on a bill to provide regulatory clarity for stablecoins while safeguarding investor interests. According to sources familiar with the matter, the senators plan to officially announce the initiative soon, following positive feedback from various stakeholders.

The proposed regulations address stablecoins’ stability concerns and their potential impact on the broader financial system. Technical assistance from key agencies such as the New York Department of Financial Services, the Federal Reserve, Treasury, and the National Economic Council has been instrumental in shaping the Senate version of the bill.

A Pro-Bitcoin stance and previous legislative efforts

Senator Lummis has been a vocal proponent of Bitcoin and has actively advocated for its adoption within the U.S. government. In October 2021, she made headlines by urging the government to embrace Bitcoin’s decentralized nature as a solution amidst concerns over the country’s debt limit.

This isn’t the first time Lummis has engaged in cryptocurrency-related legislative efforts. In 2013, she collaborated with Senator Gillibrand to reintroduce legislation to establish a comprehensive regulatory framework for digital assets.

Criticism of Tether and opposition to central bank digital currencies

Despite her support for Bitcoin, Senator Lummis has recently expressed skepticism towards certain stablecoins, particularly Tether. In October 2023, she backed a campaign calling for potential criminal charges against Tether, citing allegations of illicit financial transactions. This marked a significant departure from her previous stance on stablecoins.

Additionally, Lummis has been vocal in her opposition to central bank digital currencies (CBDCs), arguing that they threaten democratic principles and could enable financial censorship. Her stance reflects broader concerns within the cryptocurrency community regarding the role of central banks in digital currency issuance.

Disclaimer: The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decision.

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James Kinoti

A crypto enthusiast, James finds pleasure in sharing knowledge on fintech, cryptocurrency as well as blockchain and frontier technologies. The latest innovations in the crypto industry, crypto gaming, AI, blockchain technology, and other technologies are his preoccupation. His mission: be on track with transformative applications in various industries.

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