US Lawmakers Propose Bill to Boost Dollar's Global Dominance via Stablecoin Regulation

US lawmakers have proposed a bill aimed at boosting the dollar's global dominance by establishing a regulatory framework for stablecoins. The legislation, introduced by Representatives French Hill and Bryan Steil, seeks to clarify rules for dollar-pegged payment stablecoins and ensure a federal path for issuers.

The bill imposes a two-year moratorium on issuing endogenously collateralized stablecoins, prohibiting issuers from creating stablecoins backed by self-issued digital assets. It also requires the US Treasury Department to facilitate a study on stablecoins. House Financial Services Committee Chairman Hill stated that the bill would support innovation, bolster the dollar's position as the world's reserve currency, and protect consumers and investors.

This move follows the Trump administration's confirmation to regulate and bring stablecoins onshore. President Donald Trump's Crypto Czar, David Sacks, suggested that stablecoins could extend the dollar's dominance internationally. Industry observers have interpreted Trump's crypto executive order as a sign of his pro-crypto stance, aiming to position the US as a leader in digital asset development while ensuring the dollar's position as the world's reserve currency.

The latest stablecoin bill follows an effort from the Senate to introduce a similar bill. On Feb. 4, US Senator Bill Hagerty introduced the "Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act," which aims to create a regulatory framework for stablecoins and advance Trump's pledge to make the US the capital of crypto. The bill received support from senators Scott, Kirsten Gillibrand, and Cynthia Lummis. Hagerty stated that stablecoins could drive demand for US Treasurys and enhance transaction efficiency.