House Republicans Raise Concerns Over Stablecoin Legislation

A group of Republican members of the House Financial Services Committee have raised concerns about the US Federal Reserve's actions in the cryptocurrency sector.

The committee members, including Chair Patrick McHenry, expressed worries that the Fed's recent expansion of oversight into crypto-related activities at banks could hinder the development of federal regulations for stablecoins.

They also asked whether collaboration with state banking regulators is part of the central bank’s plans, since several states have already permitted certain stablecoin payment activities.

The Fed's program, introduced on August 8, aims to enhance supervision of activities such as crypto-asset custody, crypto-collateralized lending, and stablecoin issuance.

The Republicans argued that Congress should establish the regulatory framework to provide clarity for market participants, and they questioned the Fed's intentions in its oversight efforts.

The lawmakers set a deadline of September 29 for the Fed to respond to their inquiries.

The situation arises amidst ongoing efforts within the House Financial Services Committee to formulate comprehensive regulations for stablecoins.