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House Stablecoin Bill Would Put Two-Year Ban on Terra-Like Coins

  • House committee could vote on legislation as soon as next week
  • Time to consider proposal shrinking with midterms approaching
The US Capitol building in Washington, D.C.

The US Capitol building in Washington, D.C.

Photographer: Ting Shen/Bloomberg
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Legislation to regulate stablecoins that’s being drafted in the House would place a two-year ban on coins similar to TerraUSD, the algorithmic stablecoin that collapsed earlier this year.

Under the latest version of the bill, it would be illegal to issue or create new “endogenously collateralized stablecoins,” according to a copy obtained by Bloomberg. The definition would kick in for stablecoins marketed as being able to be converted, redeemed or repurchased for a fixed amount of monetary value, and that rely solely on the value of another digital asset from the same creator to maintain their fixed price.