Several Members of Congress Introduce Bill to Protect Consumers from Cryptocurrency – Crowdfund Insider

This past week, House Representative Rashida Tlaib, along with Representatives Jess Chuy Garca and Chairman of Task Force on Financial Technology Stephen Lynch, introduced the Stablecoin Tethering and Bank Licensing Enforcement (STABLE) Act (HR 8827). The goal of the legislation is to protect consumers from risks posed by emerging digital payment instruments, such as Facebooks Libra and other Stablecoins currently offered in the market.

In a release, Tlaib, Garca, and Lynch, explained that consumer vulnerabilities could be exploited and obscured by bad actors looking to issue stable-coins. This threat combined with the financial strains of the pandemic necessitate the STABLE Act that would:

Representative Tlaib stated:

Getting ahead of the curve on preventing cryptocurrency providers from repeating the crimes against low- and moderate-income residents of color that traditional big banks have isand has beencritically important. From the OCC to the Federal Reserve to those peddling stablecoins, the protections the STABLE Act would make possible are more needed than ever amid a pandemic that will breed riskier financial decisions out of necessity because our federal government continues to fail us all by not providing adequate relief legislation. I thank Congressman Garca and Chairman Lynch for co-leading this important effort to see these protections made a reality.

Representative Lynch said the bill is a concrete step toward protecting Americans finances and ensuring safety and soundness in financial institutions.

The elected officials said that Facebook has attempted to take advantage of the financial exclusion and gap in the market.

Additionally, the Representatives said that JP Morgan, Apple, and Paypal/Venmo have also considered issue their own stablecoins that also have the potential to take advantage of unbanked and underbanked communities.

Public Money Action Director and Yale Law School Associate Research Scholar Ral Carrillo added that the STABLE Act shuts the door on Big Tech companies like Facebook that are trying to enter the banking space without following the appropriate rules or conducting business on a level playing field.

The legislation was entered into the House Financial Services Committee at the end of last month. The legislation is embedded below.

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Several Members of Congress Introduce Bill to Protect Consumers from Cryptocurrency - Crowdfund Insider