Crypto-friendly top Republican Rep. French Hill would support a legislative package that includes both a bill to regulate stablecoins and another focused on marijuana banking.
Hill, who currently leads the House Financial Services subcommittee focused on digital assets, said he would vote for such a bill, as lawmakers say they are getting closer to crafting a final stablecoin bill.
“I would vote for it if it were coupled,” Hill told Bloomberg on Monday. “I have supported the SAFE Banking Act for nine years in Congress now, which would allow cannabis dealers in states where it's legal to have access to the banking system. I think it's a lot easier to catch bad actors and illegal activity if those companies are participating in the banking system.”
A stablecoin bill is likely to be included in a larger legislative package. Lawmakers, including House Financial Services Committee Chair Patrick McHenry, R-N.C., ranking Democrat Maxine Waters, D-Calif. and Senate Majority Leader Chuck Schumer have reportedly discussed attaching the bill to upcoming Federal Aviation Administration reauthorization, which could accompany cannabis legislation. That must-pass reauthorization is up against a May 10 deadline.
Including marijuana banking and stablecoins in the FAA bill is a “call that leadership has to make,” Hill told Bloomberg.
“I think there are other ways that we can do it during the course of the year,” Hill added.
If compromise is reached on combining a marijuana banking with stablecoins, it could face an uphill climb with House Speaker Mike Johnson, R-La., who has repeatedly opposed the marijuana banking bill, according to multiple news reports.
In the short run
McHenry and Waters have been working on a bill to rein in stablecoins for almost a year. Waters told Bloomberg last week she and McHenry were on their way “to getting a stablecoin bill in the short run.”
“I think Ranking Member Waters is correct, that we're very close to completing our bipartisan work together on a payment stablecoin bill that will protect consumers and enhance innovation here in the United States and make the U.S. more competitive,” Hill told Bloomberg.
One hang-up in the past has been who would be the primary regulator for stablecoin issuers — the federal government or state regulators. Last summer, Waters called the stablecoin bill “deeply problematic” due to a provision that allows state regulators to approve stablecoin issuances without Federal Reserve input. It is unclear whether that has been resolved.
On the Senate side, Sens Kirsten Gillibrand, D-N.Y., and Sen. Cynthia Lummis, R-Wyo., introduced a stablecoin bill earlier this month with a provision to create “federal and state regulatory regimes for stablecoin issuers that preserves the dual banking system.” Specifically, the bill creates a cap, allowing “state trust companies to create and issue payment stablecoins up to $10 billion.”
Hill is also vying to lead the House Financial Services Committee as chair following the retirement of current chair McHenry next year.
