Stablecoin turning point arriving? US House makes major revisions to STABLE Act
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Stablecoin turning point arriving? US House makes major revisions to STABLE Act
The bill aims to regulate payment stablecoins, establish new compliance mechanisms, expand regulatory authority, and clarify key definitions regarding the issuance and use of dollar-backed digital assets.
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On March 26, a revised version of the Stablecoin Transparency and Accountability for Ledgered Economy Act (STABLE Act), was introduced in the U.S. House of Representatives, significantly amending the draft released on February 5.
The bill aims to regulate payment stablecoins by establishing new compliance mechanisms, expanding regulatory authority, and clarifying key definitions regarding the issuance and use of dollar-backed digital assets.
The 2025 STABLE Act was formally introduced by Republican Representatives Bryan Steil of Wisconsin and French Hill of Arkansas, aiming to create a federal framework for issuing payment stablecoins.
In addition, the bill categorizes qualified issuers into three groups: federally regulated institutions, non-bank entities approved by the Office of the Comptroller of the Currency, and state-licensed institutions operating under a certification regime.
New Provisions and Structural Changes
Compared to the initial draft from early February, the March 26 revision introduces several substantive changes.
The updated bill explicitly excludes various financial products—such as securities, deposits, and credit union accounts—from the definition of "payment stablecoin." This exclusion provides developers and institutions with clearer legal boundaries regarding what qualifies under the legislation.
The new draft requires monthly attestations of reserve holdings to be verified by registered public accounting firms, and mandates that chief executive and financial officers certify the accuracy of these reports.
Knowingly submitting false certifications could result in criminal penalties of up to $1 million in fines or 10 years in prison. These certification requirements were absent in the February version.
Further updates include detailed procedures for reviewing and approving new stablecoin issuers. The revised draft sets decision deadlines for federal regulators, provides formal appeal rights, and allows applicants to reapply after denial.
Regulatory agencies must also submit annual reports to Congress on processing times for pending applications.
Bill Huizenga, Republican Representative from Michigan and original co-sponsor of the bill, emphasized its importance on X. He stated:
"Stablecoins have the potential to streamline our payment systems and transform how we move money. I'm proud to be an original co-sponsor of this legislation alongside Representatives Bryan Steil and French Hill, and look forward to the revised markup next week."
Rulemaking and Industry Coordination
A key addition requires regulators to initiate rulemaking procedures within 180 days of enactment to clarify application requirements and streamline approval processes for well-capitalized entities.
The bill also offers clear protections for issuers using public, decentralized networks, stating that such design choices should not be grounds for rejection—a significant safeguard for developers building on blockchain infrastructure.
Both the February and March versions aim to exclude payment stablecoins from being classified as securities. However, the newer version more comprehensively revises relevant provisions under the Investment Advisers Act, Securities Act, Exchange Act, and Securities Investor Protection Act to ensure consistent treatment across financial regulations.
The updated STABLE Act consolidates treatment of decentralized stablecoins and non-payment stablecoins into a single study provision and restructures its approach to international interoperability.
Under the revised Section 10, the Treasury will coordinate with foreign jurisdictions to assess comparability and support cross-border stablecoin usage, replacing the earlier draft's separate reciprocity clause.
Additional Provisions
The March 26 bill imposes strict reserve standards on stablecoin issuers, requiring full backing by cash-equivalent assets such as Treasury bills or demand deposits.
It also prohibits issuers from paying yield to token holders and limits issuer activities to core functions such as issuance, redemption, and custody services.
To protect consumers, the bill includes provisions clarifying that the U.S. government does not insure stablecoins and bans any false claims to the contrary. Violations may trigger civil penalties or criminal prosecution under existing federal laws.
The March 26 revisions indicate growing bipartisan consensus in Congress on formalizing stablecoin regulation and adapting financial policy to blockchain-native payment systems.
Moreover, it reflects a stronger response to the needs of developers and institutions operating at the intersection of fintech and traditional banking.
The U.S. House Committee on Financial Services is expected to hold a markup of the bill in the coming days. During the session, committee members will consider stakeholder perspectives and discuss amendments.
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