Circle’s Chief Strategy Officer and Head of Global Policy, Dante Disparte, is calling on the U.S. Congress to introduce comprehensive payment stablecoin legislation. Disparte will present his proposal to parliament on Wednesday, April 19, 2023, at 10 am ET. His presentation, titled “Understanding Stablecoins’ Role in Payments and the Need for Legislation,” is part of Circle’s ongoing advocacy for legislation that protects consumers, promotes responsible innovation, and advances U.S. economic growth and national security.
Disparte will use the opportunity to highlight the growing acceptance of Circle’s stablecoin, the USDC, as a dollar settlement option among major financial services firms such as Visa, MoneyGram, and WorldPay. This contradicts the general view that stablecoins would disrupt traditional financial systems or markets. Disparte will explain the stablecoin’s support for the dollar, noting that more than $132 billion of stablecoins in circulation reference the dollar. This was made possible by the early adoption of dollars as the currency of reference in digital assets markets. For USDC, Disparte’s published written statement explained that Circle went a step further by adopting macroprudential risk standards and transparency, resulting in a proliferation of enterprise use cases and adoption.
Disparte’s statement emphasized Circle’s compliance with existing regulatory standards. He praised the existing regulatory framework in the U.S. and confirmed that it produced an economic development model that enables companies to start up and scale across the U.S. He noted that the standards provided by the U.S. enabled Circle to prioritize public-private regulatory partnership and personhood. According to him, Circle has acquired a comprehensive license as a state-supervised money transmission and electronic stored value company in 48 states. It was the first company to receive a Bitlicense from the New York State Department of Financial Services (NYDFS) in 2015 and a registered Money Services Business (MSB) conforming with FinCEN’s guidance on combating illicit financial activity.
Disparte intends to urge the U.S. government to take the lead at the national level in defining what is and what is not a payment stablecoin. In the published speech, he warned that failure to do so could expose the system to something similar to the “stable-in-name-only” coin, Terra-Luna, emerging into the federal regulatory vacuum. Circle’s advocacy for stablecoin legislation is part of its long-term strategy to promote responsible innovation and ensure that the U.S. remains a global leader in the digital asset space.
Circle’s push for stablecoin legislation comes at a time when the use of stablecoins is on the rise. Stablecoins are digital assets that are designed to maintain a stable value relative to a particular asset or basket of assets, such as the U.S. dollar or gold. They offer the benefits of cryptocurrencies, such as fast and low-cost transactions, without the volatility associated with traditional cryptocurrencies like Bitcoin. As a result, stablecoins are becoming increasingly popular for use in payments and remittances.
However, stablecoins are not without their risks. They have the potential to disrupt traditional financial systems and markets, and there are concerns about their stability and security. In addition, there are questions about how they should be regulated. Currently, there is no clear regulatory framework for stablecoins in the U.S., and different agencies have taken different approaches to their regulation.
Circle’s advocacy for stablecoin legislation is a step towards addressing these concerns. By calling for comprehensive payment stablecoin legislation, Circle is seeking to promote responsible innovation, protect consumers, and ensure that the U.S. remains a global leader in the digital asset space. It remains to be seen whether the U.S. government will take up Circle’s call for action, but the push for stablecoin legislation is likely to continue as the use of stablecoins becomes more widespread.