United States of America: Introduced Stablecoin TRUST Act of 2022

On 21 December 2022, US Senate Banking Committee Ranking Member Pat Toomey introduced the "Stablecoin TRUST Act of 2022" (S.5340), which provides a regulatory framework regarding the issuance of stablecoins as well as related consumer protection. The bill provides three mechanisms for companies to issue stablecoins, namely a specific federal stablecoin license, the status of state-registered money transmitter for existing stablecoin issuers, and the status of insured depository institution. It also clarifies that traditional banks are permitted to issue payment stablecoins and gives them the option to separate stablecoin issuance from other banking activities. The Act establishes a new federal license issued by the Office of the Comptroller of the Currency (OCC) for national limited payment stablecoin issuers. The Act also clarifies that payment stablecoins are not securities and payment stablecoin issuers are not investment companies or investment advisers. Finally, the Bill foresees an investor protection mechanism by providing for the reimbursement of stablecoin holders in case of issuer insolvency.