US lawmaker introduces bill for stablecoin framework

By Ovunc Kutlu

ANKARA (AA) - A US lawmaker introduced legislation Tuesday for stablecoins -- digital coins whose prices are stabilized to a traditional currency.

New Jersey congressman Josh Gottheimer's early draft of the bill focuses on forming a framework for the much disputed and controversial stablecoins.

Gottheimer proposed that some digital currencies can be defined as qualified if they can prove a one-on-one trade for the US dollar.

Qualified stablecoins could be issued by a federal bank or a non-bank that agrees to withhold at least 100% reserve assets against it based on the dollar.

"It shall be unlawful for any person to offer, sell, or exchange as a ‘qualified stablecoin' any cryptocurrency that is not a qualified stablecoin as defined under this Act," according to the proposal.

Stablecoins are cryptocurrencies where the price is designed to be pegged to a cryptocurrency, or fiat money. Their popularity has increased in recent years since they are widely used in the crypto market.

The eight largest stablecoins had a market value of $152 billion as of Dec. 13, accounting for around 98% of their total market capitalization, according to Fitch Ratings.