House STABLE Act Must Address State Interference in Stablecoins

The House’s STABLE Act seeks to “establish a clear regulatory framework for the issuance of payment stablecoins” that will protect consumers, create guardrails, and promote “innovation in the US through a tailored approach that supports new entrants into the marketplace.”

Similar to the Senate’s GENIUS Act, the bill preempts and supersedes state money transmitter regimes, creating a single regulatory framework for prospective issuers. The bill also excludes payment stablecoins from federal securities laws, which have historically encumbered stablecoin adoption across the US. However, the bill may not go far enough. As currently drafted, state regulators could retain the power to restrict which stablecoins an exchange or other licensed intermediary may support.

In this article for Bloomberg Law, Nathaniel Reisenburg, Joseph Perkins and Ignacio Sandoval, analyze the STABLE Act’s framework and other regulatory barriers for stablecoin adoption and discuss steps lawmakers could take to better achieve the bill’s goals.