Lummis-Gillibrand Stablecoin Bill Is Issuer-Friendly, Could “Spur M&A Activity”

According to a report from investment bank TD Cowen, a bill introduced by Senators Kirsten Gillibrand and Cynthia Lummis would be a boon to stablecoin issuers. The Lummis-Gillibrand Payment Stablecoin Act, introduced last week, would establish “clear rules of conduct” for stablecoin issuers, the bank said in a report on Monday. “In our view, the Lummis-Gillibrand bill would be positive for stablecoin issuers because it would establish clear rules of conduct. It would also be symbolically important for the cryptocurrency industry as a whole, as it would be the first constructive cryptocurrency legislation to come out of Congress,” said TD Cowen’s Washington Research Group, led by Jaret Seiberg. If passed, the bill would require stablecoin issuers to hold a one-to-one cash or cash equivalent reserve to back their tokens. The bill would also ban algorithmic stablecoins and stipulate that issuers and users cannot use stablecoins for illegal or unauthorized purposes, such as money laundering. (The Block)