issued by an intergovernmental organization pursu-
ant to an agreement by one or more governments. 
(12) NONBANK ENTITY.—The term ‘‘nonbank 
entity’’ means a person that is not an insured depos-
itory institution or subsidiary of an insured deposi-
tory institution. 
(13) PAYMENT STABLECOIN.—The term ‘‘pay-
ment stablecoin’’— 
(A) means a digital asset— 
(i) that is or is designed to be used as 
a means of payment or settlement; and 
(ii) the issuer of which— 
(I) is obligated to convert, re-
deem, or repurchase for a fixed 
amount of monetary value; and 
(II) represents will maintain or 
creates the reasonable expectation 
that it will maintain a stable value rel-
ative to the value of a fixed amount of 
monetary value; and 
(B) that is not— 
(i) a national currency; or 
(ii) a security issued by an investment 
company registered under section 8(a) of 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
the Investment Company Act of 1940 (15 
U.S.C. 80a–8(a)). 
(14) 
PERMITTED
PAYMENT
STABLECOIN 
ISSUER.—The term ‘‘permitted payment stablecoin 
issuer’’ means— 
(A) a subsidiary of an insured depository 
institution that has been approved to issue pay-
ment stablecoins under section 5; 
(B) a Federal qualified nonbank payment 
stablecoin issuer that has been approved to 
issue payment stablecoins under section 5; or 
(C) a State qualified payment stablecoin 
issuer. 
(15) PERSON.—The term ‘‘person’’ means an 
individual, partnership, company, corporation, asso-
ciation (incorporated or unincorporated), trust, es-
tate, cooperative organization, or other entity. 
(16) PRIMARY FEDERAL PAYMENT STABLECOIN 
REGULATOR.— 
(A) IN
GENERAL.—The term ‘‘primary 
Federal payment stablecoin regulator’’ means— 
(i) with respect to an insured deposi-
tory institution (other than an insured 
credit union) or a subsidiary of an insured 
depository institution (other than an in-
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
sured credit union), the appropriate Fed-
eral banking agency of such insured depos-
itory institution (as defined under section 
3 of the Federal Deposit Insurance Act 
(12 U.S.C. 1813)); 
(ii) with respect to an insured credit 
union or a subsidiary of an insured credit 
union, the National Credit Union Adminis-
tration; 
(iii) with respect to a Federal quali-
fied nonbank payment stablecoin issuer 
that is not a national bank, the Board; and 
(iv) with respect to any entity char-
tered by the Comptroller, the Comptroller. 
(B) 
PRIMARY
FEDERAL
PAYMENT 
STABLECOIN
REGULATORS.—The term ‘‘pri-
mary Federal payment stablecoin regulators’’ 
means the Comptroller, the Board, the Corpora-
tion, and the National Credit Union Adminis-
tration. 
(17) 
REGISTERED
PUBLIC
ACCOUNTING 
FIRM.—The term ‘‘registered public accounting 
firm’’ has the meaning given that term under section 
2 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 
7201). 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
(18) STATE.—The term ‘‘State’’ means each of 
the several States, the District of Columbia, and 
each territory of the United States. 
(19) STATE QUALIFIED PAYMENT STABLECOIN 
ISSUER.—The 
term 
‘‘State 
qualified 
payment 
stablecoin issuer’’ means an entity that— 
(A) is legally established and approved to 
issue payment stablecoins by a State payment 
stablecoin regulator; and 
(B) issues a payment stablecoin in compli-
ance with the requirements under section 4. 
(20) STATE
PAYMENT
STABLECOIN
REGU-
LATOR.—The term ‘‘State payment stablecoin regu-
lator’’ means a State agency that has primary regu-
latory and supervisory authority in such State over 
entities that issue payment stablecoins. 
(21) SUBSIDIARY
OF
AN
INSURED
CREDIT 
UNION.—With respect to an insured credit union, 
the term ‘‘subsidiary of an insured credit union’’ 
means— 
(A) an organization providing services to 
the insured credit union that are associated 
with the routine operations of credit unions, as 
described under section 107(7)(I) of the Fed-
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
eral Credit Union Act (12 U.S.C. 1757(7)(I)); 
and 
(B) a credit union service organization, as 
such term is used under part 712 of title 12, 
Code of Federal Regulations, with respect to 
which the insured credit union has an owner-
ship interest or to which the insured credit 
union has extended a loan. 
SEC. 3. LIMITATION ON WHO MAY ISSUE A PAYMENT 
STABLECOIN. 
It shall be unlawful for any person other than a per-
mitted payment stablecoin issuer to issue a payment 
stablecoin for use by any person in the United States. 
SEC. 
4. 
REQUIREMENTS 
FOR 
ISSUING 
PAYMENT 
STABLECOINS. 
(a) STANDARDS FOR THE ISSUANCE OF PAYMENT 
STABLECOINS.— 
(1) 
IN
GENERAL.—Permitted 
payment 
stablecoin issuers shall— 
(A) maintain reserves backing the issuer’s 
payment stablecoins outstanding on an at least 
one to one basis, with reserves comprising— 
(i) United States coins and currency 
(including Federal reserve notes); 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
(ii) funds held as insured demand de-
posits or insured shares at insured deposi-
tory institutions, subject to limitations es-
tablished by the Corporation and the Na-
tional Credit Union Administration, re-
spectively, to address safety and soundness 
risks of such insured depository institu-
tions; 
(iii) Treasury bills with a maturity of 
90 days or less; 
(iv) repurchase agreements with a ma-
turity of 7 days or less that are backed by 
Treasury bills with a maturity of 90 days 
or less; 
(v) central bank reserve deposits; or 
(vi) such other assets as— 
(I) the primary Federal payment 
stablecoin regulator determines appro-
priate; or 
(II) in the case of a State quali-
fied payment stablecoin issuer, the 
State payment stablecoin regulator 
determines appropriate. 
(B) publicly disclose the issuer’s redemp-
tion policy; 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
(C) establish procedures for timely redemp-
tion of outstanding payment stablecoins; and 
(D) publish the monthly composition of the 
issuer’s reserves on the website of the issuer, 
containing— 
(i) the total number of outstanding 
payment stablecoins issued by the issuer; 
and 
(ii) the amount and composition of 
the reserves described under subparagraph 
(A). 
(2) PROHIBITION ON REHYPOTHECATION.—Re-
serves described under paragraph (1)(A) may not be 
pledged, rehypothecated, or reused, except for the 
purpose of creating liquidity to meet reasonable ex-
pectations 
of 
requests 
to 
redeem 
payment 
stablecoins, such that reserves in the form of Treas-
ury bills may be pledged as collateral for repurchase 
agreements with a maturity of 90 days or less, pro-
vided that either— 
(A) the repurchase agreements are cleared 
by a central clearing counterparty that is ap-
proved by the primary Federal payment 
stablecoin regulator; or 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00010
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
(B) the permitted payment stablecoin 
issuer receives the prior approval of the primary 
Federal payment stablecoin regulator. 
(3) MONTHLY
CERTIFICATION; EXAMINATION 
OF REPORTS BY REGISTERED PUBLIC ACCOUNTING 
FIRM.— 
(A) IN GENERAL.—A permitted payment 
stablecoin issuer shall, each month, have the in-
formation disclosed in the previous month-end 
report required under paragraph (1)(D) exam-
ined by a registered public accounting firm. 
(B) CERTIFICATION.—Each month, the 
Chief Executive Officer and Chief Financial Of-
ficer of a permitted payment stablecoin issuer 
shall submit an certification as to the accuracy 
of the monthly report to— 
(i) the primary Federal payment 
stablecoin regulator; or 
(ii) in the case of a State qualified 
payment stablecoin issuer, to the State 
payment stablecoin regulator. 
(C) CRIMINAL PENALTY.—Any person who 
submits a certification required under subpara-
graph (B) knowing that such certification is 
false shall be subject to the criminal penalties 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00011
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
set forth under section 1350(c) of title 18, 
United States Code. 
(4) CAPITAL, LIQUIDITY, AND RISK MANAGE-
MENT REQUIREMENTS.—The primary Federal pay-
ment stablecoin regulators shall, jointly, issue— 
(A) capital requirements applicable to per-
mitted payment stablecoin issuers, which may 
not exceed what is sufficient to ensure the per-
mitted payment stablecoin issuer’s ongoing op-
erations; 
(B) liquidity requirements applicable to 
permitted payment stablecoin issuers, which 
may not exceed what is sufficient to ensure the 
financial integrity of the permitted payment 
stablecoin issuer and the ability of the issuer to 
meet the financial obligations of the issuer, in-
cluding redemptions; and 
(C) risk management requirements appli-
cable to permitted payment stablecoin issuers, 
tailored to the business model and risk profile 
of the permitted payment stablecoin issuer. 
(5) TREATMENT UNDER THE BANK SECRECY 
ACT.—A permitted payment stablecoin issuer shall 
be treated as a financial institution for purposes of 
the Bank Secrecy Act. 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00012
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
(6) LIMITATION ON ACTIVITIES.—A permitted 
payment stablecoin issuer may only issue payment 
stablecoins, redeem payment stablecoins, manage re-
lated reserves (including purchasing and holding re-
serve assets), provide custodial or safekeeping serv-
ices for payment stablecoins or private keys of pay-
ment stablecoins, and undertake other functions that 
directly support the work of issuing and redeeming 
payment stablecoins. 
(b) RULEMAKING.— 
(1) IN GENERAL.—The primary Federal pay-
ment stablecoin regulators may issue such orders 
and regulations as may be necessary to administer 
and carry out the requirements of this section, in-
cluding to establish conditions, and to prevent eva-
sions thereof. 
(2) JOINT ISSUANCE OF REGULATION.—All reg-
ulations issued to carry out this section shall be 
issued jointly by the primary Federal payment 
stablecoin regulators. 
(3) RULEMAKING DEADLINE.—Not later than 
the end of the 180-day period beginning on the date 
of enactment of this Act, the Federal payment 
stablecoin regulators shall issue regulations to carry 
out this section. 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00013
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
SEC. 5. APPROVAL OF SUBSIDIARIES OF INSURED DEPOSI-
TORY INSTITUTIONS AND FEDERAL QUALI-
FIED 
NONBANK 
PAYMENT 
STABLECOIN 
ISSUERS. 
(a) IN GENERAL.— 
(1) APPLICATION.— 
(A) IN GENERAL.—Any insured depository 
institution 
that 
seeks 
to 
issue 
payment 
stablecoins through a subsidiary and any 
nonbank entity (other than a State qualified 
payment stablecoin issuer) that seeks to issue 
payment stablecoins shall file an application 
with the primary Federal payment stablecoin 
regulator. 
(B) TIMING.—With respect to an applica-
tion filed under this paragraph, the primary 
Federal payment stablecoin regulator shall in-
form the applicant whether the applicant has 
submitted a complete application within 45 
days of receiving the application. 
(C) COMPLETION OF APPLICATION.—With 
respect to an application filed under this para-
graph, once the primary Federal payment 
stablecoin regulator has informed the applicant 
that the application is complete, such applica-
tion shall be deemed to be complete unless the 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00014
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
primary Federal payment stablecoin regulator 
determines that a significant change in cir-
cumstances requires otherwise. 
(2) EVALUATION
OF
APPLICATIONS.—A com-
plete application received under paragraph (1) shall 
be evaluated by the primary Federal payment 
stablecoin regulator using the factors described in 
paragraph (3). 
(3) FACTORS TO BE CONSIDERED.—The factors 
described in this paragraph are the following: 
(A) The ability of the applicant (or, in the 
case of an applicant that is an insured deposi-
tory institution, the subsidiary of the appli-
cant), based on the financial condition and re-
sources, to meet the requirements set forth in 
section 4. 
(B) The general character and fitness of 
the management of the applicant. 
(C) The risks presented by the applicant 
and benefits provided to consumers. 
(4) TIMING FOR DECISION; GROUNDS FOR DE-
NIAL.— 
(A) TIMING.—The primary Federal pay-
ment stablecoin regulator shall render a deci-
sion on an application no later than 120 days 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00015
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
after informing the applicant that the applica-
tion is complete. 
(B) DENIAL OF APPLICATION.— 
(i) GROUNDS FOR DENIAL.—The pri-
mary Federal payment stablecoin regulator 
may only deny a complete application re-
ceived under paragraph (1) if the regulator 
determines that the activities of the appli-
cant would be unsafe or unsound based on 
the factors described in paragraph (3). 
(ii) EXPLANATION REQUIRED.—If the 
primary Federal payment stablecoin regu-
lator denies a complete application received 
under paragraph (1), the regulator shall 
provide the applicant with written notice 
explaining such denial, including all find-
ings made by the regulator with respect to 
all identified material shortcomings regard-
ing the application, including recommenda-
tions on how the applicant could address 
the identified material shortcomings. 
(iii) OPPORTUNITY
FOR
HEARING; 
FINAL DETERMINATION.— 
(I) IN GENERAL.—Not later than 
30 days after the date of receipt of 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00016
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
any notice of the denial of an applica-
tion under this subsection, the appli-
cant may request, in writing, an op-
portunity for a written or oral hearing 
before the primary Federal payment 
stablecoin regulator to appeal the de-
nial. 
(II) TIMING.—Upon receipt of a 
timely request, the primary Federal 
payment stablecoin regulator shall no-
tice a time (not later than 30 days 
after the date of receipt of the re-
quest) and place at which the appli-
cant 
may 
appear, 
personally 
or 
through counsel, to submit written 
materials or provide oral testimony 
and oral argument). 
(III) FINAL
DETERMINATION.— 
Not later than 60 days after the date 
of a hearing under this clause, the 
primary Federal payment stablecoin 
regulator shall notify the applicant of 
the final determination of the primary 
Federal payment stablecoin regulator, 
which shall contain a statement of the 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00017
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
basis for that determination, with spe-
cific findings. 
(IV) NOTICE IF NO HEARING.—If 
an applicant does not make a timely 
request for a hearing under this 
clause, the primary Federal payment 
stablecoin regulator shall notify the 
applicant, not later than 10 days after 
the date by which the applicant may 
request a hearing under this clause, in 
writing, that the denial of the applica-
tion is a final determination of the 
regulator. 
(C) FAILURE TO RENDER A DECISION.—If 
the primary Federal payment stablecoin regu-
lator fails to render a decision on a complete 
application within the time period specified in 
subparagraph (A), the application shall be 
deemed approved. 
(D) RIGHT TO REAPPLY.—The denial of 
an application under this subsection shall not 
prohibit the applicant from filing a subsequent 
application. 
(5) REPORT
ON
PENDING
APPLICATIONS.— 
Each primary Federal payment stablecoin regulator 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00018
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
shall annually report to Congress on the applications 
that have been pending for 6 months or longer since 
the date of the initial application filed under para-
graph (1) where the applicant has been informed 
that the application remains incomplete, including 
providing documentation on the status of the appli-
cation and why the application has not yet been ap-
proved. 
(6) RULEMAKING.—The primary Federal regu-
latory agencies shall, jointly, issue rules necessary 
for the regulation of the issuance of payment 
stablecoins, but may not impose requirements incon-
sistent with the requirements specified under section 
4. 
(b) EFFECTIVE DATE.— 
(1) IN GENERAL.—This section shall take effect 
on the earlier of— 
(A) 18 months after the date of enactment 
of this Act; or 
(B) the date that is 120 days after the 
date on which the primary Federal payment 
stablecoin regulators issue final regulations im-
plementing this section. 
(2) AUTHORITY TO ISSUE REGULATIONS AND 
PROCESS APPLICATIONS.—The primary Federal pay-
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00019
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
ment stablecoin regulators may, before the effective 
date described under paragraph (1)— 
(A) issue regulations to carry out this sec-
tion; and 
(B) pursuant to regulations described 
under subparagraph (A), accept and process ap-
plications described under this section. 
(3) NOTICE TO CONGRESS.—Each of the pri-
mary Federal payment stablecoin regulators shall 
notify Congress once beginning to process applica-
tions described under this section. 
(4) SAFE
HARBOR
FOR
PENDING
APPLICA-
TIONS.—The primary Federal payment stablecoin 
regulator may waive the application of the require-
ments of this section for a period not to exceed 12 
months beginning on the effective date described 
under paragraph (1), with respect to— 
(A) a subsidiary of an insured depository 
institution, if the insured depository institution 
has an application pending for the subsidiary to 
become a permitted payment stablecoin issuer 
on the effective date described under paragraph 
(1); or 
(B) a nonbank entity with an application 
pending to become a Federal qualified nonbank 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00020
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
stablecoin issuer on the effective date described 
under paragraph (1). 
SEC. 6. SUPERVISION AND ENFORCEMENT WITH RESPECT 
TO SUBSIDIARIES OF INSURED DEPOSITORY 
INSTITUTIONS 
AND 
FEDERAL 
QUALIFIED 
NONBANK STABLECOIN ISSUERS. 
(a) SUPERVISION.— 
(1) SUBSIDIARY OF AN INSURED DEPOSITORY 
INSTITUTION.— 
(A) IN
GENERAL.—Each permitted pay-
ment stablecoin issuer that is a subsidiary of an 
insured depository institution shall be subject to 
supervision by the primary Federal payment 
stablecoin regulator in the same manner as 
such insured depository institution. 
(B) 
GRAMM-LEACH-BLILEY
ACT.—For 
purposes of title V of the Gramm-Leach-Bliley 
Act (15 U.S.C. 6801 et seq.) each permitted 
payment stablecoin issuer that is a subsidiary 
of an insured depository institution shall be 
deemed a financial institution. 
(2) FEDERAL QUALIFIED NONBANK PAYMENT 
STABLECOIN ISSUER.— 
(A) SUBMISSION OF REPORTS.—Each Fed-
eral qualified nonbank payment stablecoin 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00021
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
(I) the safety and soundness of 
the 
Federal 
qualified 
nonbank 
stablecoin issuer; or 
(II) the stability of the financial 
system of the United States; and 
(iii) the systems of the Federal quali-
fied nonbank payment stablecoin issuer for 
monitoring and controlling the risks de-
scribed in clause (ii). 
(C) REQUIREMENT TO USE EXISTING RE-
PORTS.—In supervising and examining a Fed-
eral qualified nonbank payment stablecoin 
issuer, the primary Federal payment stablecoin 
regulator shall, to the fullest extent possible, 
use existing reports and other supervisory infor-
mation. 
(D) AVOIDANCE
OF
DUPLICATION.—The 
primary Federal payment stablecoin regulator 
shall, to the fullest extent possible, avoid dupli-
cation of examination activities, reporting re-
quirements, and requests for information in 
carrying out this Act with respect to a Federal 
qualified nonbank payment stablecoin issuer. 
(E) 
GRAMM-LEACH-BLILEY
ACT.—For 
purposes of title V of the Gramm-Leach-Bliley 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00023
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
Act (15 U.S.C. 6801 et seq.) each Federal 
qualified nonbank stablecoin issuer shall be 
deemed a financial institution. 
(b) ENFORCEMENT.— 
(1) SUSPENSION OR REVOCATION OF REGISTRA-
TION.—The primary Federal payment stablecoin 
regulator 
may 
prohibit 
a 
permitted 
payment 
stablecoin issuer from issuing payment stablecoins, if 
the primary Federal payment stablecoin regulator 
determines that such permitted payment stablecoin 
issuer, or an institution-affiliated party of the per-
mitted payment stablecoin issuer, is— 
(A) violating or has violated this Act or 
any regulation or order issued under this Act; 
or 
(B) violating or has violated any condition 
imposed in writing by the primary Federal pay-
ment stablecoin regulator in connection with a 
written agreement entered into between the per-
mitted payment stablecoin issuer and the pri-
mary Federal payment stablecoin regulator or a 
condition imposed in connection with any appli-
cation or other request. 
(2) CEASE-AND-DESIST PROCEEDINGS.—If the 
primary Federal payment stablecoin regulator has 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00024
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
reasonable cause to believe that a permitted payment 
stablecoin issuer or any institution-affiliated party of 
a permitted payment stablecoin issuer is violating, 
has violated, or is attempting to violate this Act, any 
regulation or order issued under this Act, or any 
written agreement entered into with the primary 
Federal payment stablecoin regulator or condition 
imposed in writing by the primary Federal payment 
stablecoin regulator in connection with any applica-
tion or other request, the primary Federal payment 
stablecoin regulator may, by provisions that are 
mandatory or otherwise, order the permitted pay-
ment stablecoin issuer or institution-affiliated party 
of the permitted payment stablecoin issuer to— 
(A) cease and desist from such violation or 
practice; 
(B) take affirmative action to correct the 
conditions resulting from any such violation or 
practice; or 
(C) take such other action as the primary 
Federal payment stablecoin regulator deter-
mines to be appropriate. 
(3) REMOVAL AND PROHIBITION AUTHORITY.— 
The primary Federal payment stablecoin regulator 
may remove an institution-affiliated party of a per-
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00025
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
mitted payment stablecoin issuer from their position 
or office or prohibit further participation in the af-
fairs of the permitted payment stablecoin issuer or 
all permitted payment stablecoin issuers by such in-
stitution-affiliated party, if the primary Federal pay-
ment stablecoin regulator determines that— 
(A) the institution-affiliated party has, di-
rectly or indirectly, committed a violation or at-
tempted violation of this Act or any regulation 
or order issued under this Act; or 
(B) the institution-affiliated party has 
committed a violation of any provision of sub-
chapter II of chapter 53 of title 31, United 
States Code. 
(4) PROCEDURES.— 
(A) IN GENERAL.—If the primary Federal 
payment stablecoin regulator identifies a viola-
tion or attempted violation of this Act or makes 
a determination under paragraph (1), (2), or 
(3), the primary Federal payment stablecoin 
regulator shall comply with the procedures set 
forth in subsections (b) and (e) of sections 8 of 
the Federal Deposit Insurance Act (12 U.S.C. 
1818). 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00026
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
(B) JUDICIAL
REVIEW.—A person ag-
grieved by a final action under this subsection 
may obtain judicial review of such action exclu-
sively as provided in section 8(h) of the Federal 
Deposit Insurance Act (12 U.S.C. 1818(h)). 
(C) INJUNCTION.—The primary Federal 
payment stablecoin regulator may, in the dis-
cretion of the regulator, follow the procedures 
provided in section 8(i)(1) of the Federal De-
posit Insurance Act (12 U.S.C. 1818(i)(1)) for 
judicial enforcement of any effective and out-
standing notice or order issued under this sub-
section. 
(D) TEMPORARY CEASE-AND-DESIST PRO-
CEEDINGS.—If the primary Federal payment 
stablecoin regulator determines that a violation 
or attempted violation of this Act or an action 
with respect to which a determination was made 
under paragraph (1), (2), or (3), or the con-
tinuation thereof, is likely to cause insolvency or 
significant dissipation of assets or earnings of a 
permitted payment stablecoin issuer, or is likely 
to weaken the condition of the permitted pay-
ment stablecoin issuer or otherwise prejudice 
the interests of the customers of the permitted 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00027
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
payment stablecoin issuer prior to the comple-
tion the proceedings conducted under this para-
graph, the primary Federal payment stablecoin 
regulator may follow the procedures provided in 
section 8(c) of the Federal Deposit Insurance 
Act (12 U.S.C. 1818(c)) to issue a temporary 
cease-and-desist order. 
(5) CIVIL MONEY PENALTIES.— 
(A) FAILURE TO BE APPROVED.—Any per-
son who issues a payment stablecoin and who is 
not a permitted payment stablecoin issuer, and 
any institution-affiliated party of such a person 
who knowingly participates is issuing such a 
payment stablecoin, shall be liable for a civil 
penalty of not more than $100,000 for each day 
during which such payment stablecoins are 
issued. 
(B) FIRST TIER.—Except as provided in 
subparagraph 
(A), 
a 
permitted 
payment 
stablecoin issuer or institution-affiliated party 
of such permitted payment stablecoin issuer 
that violates this Act or any regulation or order 
issued under this Act, or that violates any con-
dition imposed in writing by the primary Fed-
eral payment stablecoin regulator in connection 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00028
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
with a written agreement entered into between 
the permitted payment stablecoin issuer and the 
primary Federal payment stablecoin regulator 
or a condition imposed in connection with any 
application or other request, shall be liable for 
a civil penalty of up to $100,000 for each day 
during which the violation continues. 
(C) SECOND TIER.—Except as provided in 
subparagraph (A), and in addition to the pen-
alties described under subparagraph (B), a per-
mitted payment stablecoin issuer or institution- 
affiliated party of such permitted payment 
stablecoin issuer who knowingly participates in 
a violation of any provision of this Act, or any 
regulation or order issued thereunder, is liable 
for a civil penalty of up to an additional 
$100,000 for each day during which the viola-
tion continues. 
(D) PROCEDURE.—Any penalty imposed 
under this paragraph may be assessed and col-
lected 
by 
the 
primary 
Federal 
payment 
stablecoin regulator pursuant to the procedures 
set forth in section 8(i)(2) of the Federal De-
posit Insurance Act (12 U.S.C. 1818(i)(2)). 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00029
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
(E) NOTICE AND ORDERS AFTER SEPARA-
TION FROM SERVICE.—The resignation, termi-
nation of employment or participation, or sepa-
ration of an institution-affiliated party (includ-
ing a separation caused by the closing of a per-
mitted payment stablecoin issuer) shall not af-
fect the jurisdiction and authority of the pri-
mary Federal payment stablecoin regulator to 
issue any notice or order and proceed under 
this subsection against any such party, if such 
notice or order is served before the end of the 
six-year period beginning on the date such 
party ceased to be an institution-affiliated party 
with respect to such permitted payment 
stablecoin issuer. 
(6) NON-APPLICABILITY
TO
A
STATE
QUALI-
FIED
PAYMENT
STABLECOIN
ISSUER.—This sub-
section shall not apply to a State qualified payment 
stablecoin issuer. 
SEC. 7. STATE QUALIFIED PAYMENT STABLECOIN ISSUERS. 
(a) IN GENERAL.—A State payment stablecoin regu-
lator shall have supervisory, examination, and enforcement 
authority over a State qualified payment stablecoin issuer 
of such State. 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00030
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
(b) AUTHORITY
TO
ENTER
INTO
AGREEMENTS 
WITH THE BOARD.—A State payment stablecoin regu-
lator may enter into a memorandum of understanding 
with the Board, by mutual agreement, under which the 
Board may carry out the supervision, examination, and 
enforcement authority with respect to the State qualified 
payment stablecoin issuers of such State. 
(c) SHARING OF INFORMATION.—A State payment 
stablecoin regulator and the Board shall share information 
on an ongoing basis with respect to a State qualified pay-
ment stablecoin issuer of such State, including a copy of 
the initial application and any accompanying documents. 
(d) RULEMAKING.—The Board shall issue orders and 
rules under section 4 applicable to State qualified payment 
stablecoin issuers to the same extent as the primary Fed-
eral payment stablecoin regulators issue orders and rules 
under section 4 applicable to permitted payment stablecoin 
issuers that are not a State qualified payment stablecoin 
issuers. 
(e) BOARD ENFORCEMENT AUTHORITY IN EXIGENT 
CIRCUMSTANCES.— 
(1) IN
GENERAL.—In exigent circumstances, 
the Board may, after no less than 48 hours prior 
written notice to the applicable State payment 
stablecoin regulator, take an enforcement action 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00031
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
against a State qualified payment stablecoin issuer 
or an institution-affiliated party of such issuer for 
violations of this Act. 
(2) RULEMAKING.—Not later than the end of 
the 180-day period beginning on the date of enact-
ment of this Act, the Board shall issue rules to set 
forth those exigent circumstances in which the 
Board may act under this subsection. 
(f) GRAMM-LEACH-BLILEY ACT.—For purposes of 
title V of the Gramm-Leach-Bliley Act (15 U.S.C. 6801 
et seq.) a State qualified payment stablecoin issuer is 
deemed a financial institution. 
(g) EFFECT ON STATE LAW.—The provisions of this 
section do not preempt any law of a State and do not su-
persede any State licensing requirement. 
SEC. 8. CUSTOMER PROTECTION. 
(a) IN GENERAL.—A person may only engage in the 
business of providing custodial or safekeeping services for 
permitted payment stablecoins or private keys of per-
mitted payment stablecoins, if the person— 
(1) is subject to— 
(A) supervision or regulation by a primary 
Federal payment stablecoin regulator or a pri-
mary financial regulatory agency described 
under subparagraph (B) or (C) of section 2(12) 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00032
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
of the Dodd-Frank Wall Street Reform and 
Consumer 
Protection 
Act 
(12 
U.S.C. 
5301(12)); or 
(B) supervision by a State bank super-
visor, as defined under section 3 of the Federal 
Deposit Insurance Act (12 U.S.C. 1813) or a 
State credit union supervisor, as defined under 
section 6003 of the Anti-Money Laundering Act 
of 2020, and such state bank supervisor or 
state credit union supervisor makes available to 
the Board such information as the Board deter-
mines necessary and relevant to the categories 
of information under subsection (d); and 
(2) complies with the segregation requirements 
under subsection (b), unless such person complies 
with similar requirements as required by a primary 
Federal payment stablecoin regulator, the Securities 
and Exchange Commission, or the Commodity Fu-
tures Trading Commission. 
(b) SEGREGATION REQUIREMENT.—A person de-
scribed in subsection (a) shall— 
(1) treat and deal with the payment stablecoins, 
private keys, cash, and other property of a person 
for whom or on whose behalf the person receives, ac-
quires, or holds payment stablecoins, private keys, 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00033
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
cash, and other property (hereinafter in this section 
referred to as the ‘‘customer’’) as belonging to such 
customer; and 
(2) take such steps as are appropriate to pro-
tect the payment stablecoins, private keys, cash, and 
other property of a customer from the claims of 
creditors of the person. 
(c) COMMINGLING PROHIBITED.— 
(1) IN GENERAL.—Payment stablecoins, cash, 
and other property of a customer shall be separately 
accounted for by a person described in subsection 
(a) and shall not be commingled with the funds of 
the person. 
(2) EXCEPTION.—Notwithstanding paragraph 
(1)— 
(A) the payment stablecoins, cash, and 
other property of a customer may, for conven-
ience, be commingled and deposited in an omni-
bus account holding the payment stablecoins, 
cash, and other property of more than one cus-
tomer at an insured depository institution or 
trust company; 
(B) such share of the payment stablecoins, 
cash, and other property of the customer that 
shall be necessary to transfer, adjust, or settle 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00034
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
a transaction or transfer of assets may be with-
drawn and applied to such purposes, including 
the payment of commissions, taxes, storage, 
and other charges lawfully accruing in connec-
tion with the provision of services by a person 
described in subsection (a); and 
(C) in accordance with such terms and 
conditions as the Board may prescribe by rule, 
regulation, or order, any customer payment 
stablecoin, cash, and other property described 
in this subsection may be commingled and de-
posited in customer accounts with payment 
stablecoins, cash, and other property received 
by the person and required by the Board to be 
separately accounted for, treated, and dealt 
with as belonging to customers. 
(d) REGULATORY
INFORMATION.—A person de-
scribed under subsection (a) shall submit to the Board in-
formation concerning the person’s business operations and 
processes to protect customer assets, in such form and 
manner as the Board shall determine. 
(e) EXCLUSION.—The requirements of this section 
shall not apply to any person solely on the basis that such 
person engages in the business of providing hardware or 
software to facilitate a customer’s own custody or safe-
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00035
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
keeping of the customer’s payment stablecoins or private 
keys. 
(f) CLARIFICATION.—The Board, the Comptroller, 
the Corporation, the National Credit Union Administra-
tion, and the Financial Crimes Enforcement Network shall 
make no rules, regulations, orders, or guidance, or take 
any other administrative action, which would restrict the 
ability of an individual to use digital assets for such indi-
vidual’s own purposes or prohibit or otherwise restrict an 
individual to use hardware or software to facilitate such 
individual’s own custody or safekeeping of such individ-
ual’s digital assets. 
SEC. 9. INTEROPERABILITY STANDARDS. 
The primary Federal payment stablecoin regulators, 
in consultation with the National Institute of Standards 
and Technology, other relevant standard setting organiza-
tions, and State governments, shall assess and, if nec-
essary, may, pursuant to section 553 of title 5 and in a 
manner consistent with the National Technology Transfer 
and Advancement Act of 1995 (Public Law 104–113), 
prescribe standards for payment stablecoin issuers to pro-
mote compatibility and interoperability. 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00036
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
SEC. 
10. 
MORATORIUM 
ON 
ENDOGENOUSLY 
COLLATERALIZED STABLECOINS. 
(a) MORATORIUM.—During the 2-year period begin-
ning on the date of enactment of this Act, it shall be un-
lawful to issue, create, or originate an endogenously 
collateralized stablecoin not in existence on the date of en-
actment of this Act. 
(b) STUDY BY TREASURY.— 
(1) STUDY.—The Secretary of the Treasury, in 
consultation with the Board, the Comptroller, the 
Corporation, and the Securities and Exchange Com-
mission, shall carry out a study of endogenously 
collateralized stablecoins. 
(2) REPORT.—Not later than 365 days after 
the date of the enactment of this Act, the Secretary 
shall provide to the Committee on Financial Services 
of the House of Representatives and the Committee 
on Banking, Housing, and Urban Affairs of the Sen-
ate a report that contains all findings made in car-
rying out the study under subsection (a), including 
an analysis of— 
(A) 
the 
categories 
of 
non-payment 
stablecoins, including the benefits and risks of 
technological design features; 
(B) 
the 
participants 
in 
non-payment 
stablecoin arrangements; 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00037
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
(C) utilization and potential utilization of 
non-payment stablecoins; 
(D) nature of reserve compositions; 
(E) types of algorithms being employed; 
(F) governance structure, including aspects 
of decentralization; 
(G) nature of public promotion and adver-
tising; and 
(H) clarity and availability of consumer 
notices disclosures. 
(c) ENDOGENOUSLY COLLATERALIZED STABLECOIN 
DEFINED.—In this section, the term ‘‘endogenously 
collateralized stablecoin’’ means any digital asset— 
(1) in which its originator has represented will 
be converted, redeemed, or repurchased for a fixed 
amount of monetary value; and 
(2) that relies solely on the value of another 
digital asset created or maintained by the same 
originator to maintain the fixed price. 
SEC. 11. REPORT ON RULEMAKING STATUS. 
Not later than 6 months after the date of enactment 
of this Act, the primary Federal payment stablecoin regu-
lators shall provide a status update on the development 
of the rulemaking under this Act to the Committee on Fi-
nancial Services of the House of Representatives and the 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00038
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
Committee on Banking, Housing, and Urban Affairs of 
the Senate. 
SEC. 12. AUTHORITY OF BANKING INSTITUTIONS. 
(a) RULE OF CONSTRUCTION.—Nothing in this Act 
may be construed to limit the authority of a depository 
institution, Federal credit union, State credit union, or 
trust company to engage in activities permissible pursuant 
to applicable State and Federal law, including— 
(1) accepting or receiving deposits and issuing 
digital assets that represent deposits; 
(2) utilizing a distributed ledger for the books 
and records of the entity and to affect intrabank 
transfers; and 
(3) providing custodial services for payment 
stablecoins, private keys of payment stablecoins, or 
reserves backing payment stablecoins. 
(b) TREATMENT OF CUSTODY ACTIVITIES.—The ap-
propriate Federal banking agency (as defined under sec-
tion 3 of the Federal Deposit Insurance Act (12 U.S.C. 
1813)), the National Credit Union Administration (in the 
case of a credit union), and the Securities and Exchange 
Commission may not require a depository institution, na-
tional bank, Federal credit union, State credit union, or 
trust company, or any affiliate thereof— 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00039
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS
(1) to include assets held in custody as a liabil-
ity on any financial statement or balance sheet, in-
cluding payment stablecoin custody or safekeeping 
activities; 
(2) to hold additional regulatory capital against 
assets in custody or safekeeping, except as necessary 
to mitigate against operational risks inherent with 
the custody or safekeeping services, as determined 
by— 
(A) the appropriate Federal banking agen-
cy; 
(B) the National Credit Union Administra-
tion (in the case of a credit union); 
(C) a State bank supervisor (as defined 
under section 3 of the Federal Deposit Insur-
ance Act (12 U.S.C. 1813)); or 
(D) a State credit union supervisor (as de-
fined under section 6003 of the Anti-Money 
Laundering Act of 2020); 
(3) to recognize a liability for any obligations 
related to activities or services performed for digital 
assets that the entity does not own if that liability 
would exceed the expense recognized in the income 
statement as a result of the corresponding obliga-
tion. 
VerDate Sep 11 2014 
00:40 Jul 22, 2023
Jkt 039200
PO 00000
Frm 00040
Fmt 6652
Sfmt 6201
E:\BILLS\H4766.IH
H4766
kjohnson on DSK79L0C42PROD with BILLS