The U.S. House Committee on Financial Services will hold a hearing on Tuesday with the Securities and Exchange Commission (SEC) Chair, Gary Gensler, as the star witness, to discuss the “Oversight of the Securities and Exchange Commission.” The following day, the Subcommittee on Digital Assets, Financial Technology and Inclusion will discuss draft legislation related to stablecoins.
One of the issues on the table is Gensler’s latest policy move to change the statutory definition of a securities exchange, which SEC Commissioner Hester Peirce opposes. Gensler argues that the amendment is necessary to address platforms trading crypto asset securities, including “DeFi systems,” while Peirce argues that the proposed change undermines innovation and the First Amendment.
Other topics up for discussion include the SEC’s regulatory developments, rulemaking, and activities, as well as the potential expansion of the SEC’s authority over digital asset trading platforms. The committee will also revisit the SEC proposal calling for registered investment advisors to include Bitcoin holdings among other assets held by “qualified custodians,” which Peirce says the Commission does not have the authority to regulate directly.
On Wednesday, the Subcommittee will address “Understanding Stablecoins’ Role in Payments and the Need for Legislation” and review a 72-page draft of legislation proposing requirements for payment stablecoin issuers, research on a digital dollar, and other purposes. The draft bill includes extensive definitions, sets up standards for interoperability, reporting, and enforcement, and calls for a two-year moratorium on new stablecoins until a study can be completed by the U.S. Treasury.
Various industry leaders are expected to testify, including Dante Disparte, chief strategy officer and global policy head at Circle, and Jake Chervinsky, chief policy officer at the Blockchain Association. While the proposed bill is a product of bipartisan efforts, it still requires further work to address open and challenging issues. The role of the dollar in the world and currency on the internet is at stake, and political leaders must work to get it right.
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