Circle CEO Jeremy Allaire is optimistic that the U.S. will enact a much-anticipated law regulating stablecoins in 2023. During an interview with CNBC at the World Economic Forum Annual Meeting in Davos, Switzerland, on January 15, Allaire expressed his belief in the potential passage of the legislation this year. "There's a growing momentum, and I think there's a strong possibility this bill will become law within the year," he said.
Allaire noted the global emergence of digital dollars and the fact that other countries are regulating U.S. dollar digital currencies ahead of the U.S., highlighting a pressing need for the U.S. to take action to maintain its leadership and implement necessary consumer protections. As the head of the company that operates the USD Coin stablecoin, Allaire has observed recent developments from U.S. lawmakers, courts, and regulators. Dante Disparte, Circle’s Chief Strategy Officer and Head of Global Public Policy, also spoke with CNBC, sharing his optimism for a stablecoin payments policy early in the year, given the bipartisan reality of the issue.
A key piece of legislation, the Payments in Stablecoins Act, introduced by U.S. Rep. Patrick McHenry, is pending in both the House and Senate. This bill seeks to establish a regulatory framework for stablecoin
issuers, akin to that of traditional financial institutions. Additionally, Senator Bill Hagerty introduced the Stablecoin Transparency Act to Congress on March 31, 2022.
Circle has been actively advocating for stablecoin legislation, engaging the strategy consulting firm Invariant for lobbying efforts starting in late 2021. They have reportedly spent around $760,000 on these efforts, according to ProPublica. With the recent approval and launch of spot Bitcoin exchange-traded funds, Allaire anticipates further regulatory progress: “This is a pivotal moment, and we believe that 2024, with clear regulations on spot ETFs and global regulation, will brighten the prospects in this sector.”
However, Disparte pointed out that lawmakers remain concerned about the potential misuse of stablecoins, such as funding terrorism in the Middle East or fentanyl trafficking within the United States. He emphasized that addressing these issues is crucial for the country's and the economy's interests.
