U.S. Senate Banking Committee member Pat Toomey released his draft of the Stablecoin Reserve Transparency and Uniform Secure Transactions Act (Stablecoin TRUST Act) on April 6. The bill as currently written focuses on a new definition that pays for Stablecoins, which must be convertible into fiat currency and whose backing must also be limited to assets that are “dollar-denominated in cash and cash equivalents or Tier 1 high-quality liquid assets.”
Afterwards, payment Stablecoin issuers will be able to operate within one of three separate licensing regimes that they define as issuers of “payment Stablecoins”, including traditional banking licenses, new licenses for payment Stablecoins, and state money transmissions business license.
The current text will also require disclosure of support, redemption policies and periodic certification. Crucially, it makes no mention of audits, and it also requires the Securities Exchange Act to be read as the term securities does not include payment for Stablecoins, protecting Stablecoins from the regulation required for stocks. Toomey has yet to formally introduce the draft legislation, instead circulating it for public comment.