Partick McHenry, chairman of the White House Financial Services Committee, made regulatory statements following PayPal’s stablecoin move.
McHenry made the statements after PayPal announced that it will issue stablecoins for crypto payments. However, he reminded the necessity of stablecoin regulations.
Stablecoin regulation exit from Patrick McHenry
Patrick T. McHenry, Chairman of the House Financial Services Committee, highlighted the need for legislation to regulate stablecoins following PayPal’s move to issue stablecoins. He said on Monday that the United States was “at a crossroads” in this regard. McHenry stressed that stablecoins can make a significant contribution to the 21st century payment system and under a regulatory framework, this technology shows promise.
“We are at a crossroads to keep America at the forefront of digital asset innovation. Congress is making significant, bipartisan progress in legislation to enable the United States to take the lead on the future financial system. We need to finish the job,” he said.
PayPal announced that it is launching a stablecoin pegged to the US dollar in collaboration with Paxos. The company announced that the token will be made available to its customers in the US “in stages”. PayPal also stated that it is investigating a stablecoin issuance in 2021 but has been delayed by regulatory reviews.
The House Financial Services Committee developed a regulatory framework for payment stablecoins last month called the Clarity Stablecoins for Payment Act. McHenry stated that they would protect consumers through federal regulations while promoting innovation with this law. However, Democrats worried that these regulations could increase the power of big companies like Amazon and Facebook by giving companies the opportunity to issue their own digital currencies.
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