The US Treasury Department has submitted proposed stablecoin legislation to Congress that would require all dollar-denominated stablecoins to maintain 100% reserves in cash and short-term Treasuries, subject to bank-like regulatory oversight.
Key Provisions
The Stablecoin Trust and Transparency Act would create a comprehensive federal framework for stablecoin issuance.
- 100% reserve requirement in cash, Treasury bills, or Fed reverse repo agreements
- Monthly attestations by registered accounting firms (quarterly full audits)
- Stablecoin issuers must hold a federal or state banking charter
- Consumer redemption guaranteed within 24 hours at par value
- Foreign-issued stablecoins (like USDT from Tether) must comply to be traded on US platforms
Industry Reaction
Circle (USDC issuer) has publicly supported the legislation, having already met most requirements. Tether, whose reserve composition has been questioned for years, faces the most significant compliance challenge. Crypto industry groups support the regulatory clarity while objecting to the banking charter requirement as too restrictive for innovation.
