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What kind of US dollar stablecoin will the STABLE Act establish?
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The first step of the STABLE Act is to clarify the core objects of regulation: USD-anchored stablecoins issued to the public and directly used for payment and settlement. In other words, what are truly included in the regulatory framework are those crypto assets used as on-chain USD substitutes, rather than all tokens claiming to be pegged to the USD. In order to avoid the spread of risks, the Act also explicitly excludes some high-risk or structurally unstable token models. For example, algorithmic stablecoins, partially collateralized stablecoins, or pseudo-stablecoins with speculative attributes and complex circulation mechanisms are not within the scope of this Act. Only stablecoins that are fully backed by 1:1 USD assets, have a transparent reserve structure, and are circulated in daily transactions for the public are considered payment stablecoins and need to be subject to regulatory arrangements under this Act.
In addition to regulatory entry thresholds and issuer qualification requirements, the STABLE Act particularly emphasizes the redemption rights of stablecoin holders, that is, the public has the right to redeem the stablecoins in their hands for US dollar fiat currency at a 1:1 ratio, and the issuer must fulfill this obligation at any time. This institutional arrangement is essentially to ensure that stablecoins do not become pseudo-anchored assets or internally circulating system tokens.
On the basis that stablecoins must be redeemable at a 1:1 ratio, the STABLE Act further specifies the types, management methods and audit mechanisms of reserve assets, with the intention of controlling risks at the source and avoiding the hidden dangers of superficial anchoring and actual idleness.
In terms of regulatory path design, the STABLE Act does not adopt license classification management, but instead establishes a unified registration-based access mechanism. The core point is that all institutions that intend to issue payment stablecoins, whether or not they are banks, must register with the Federal Reserve and accept federal regulatory review.
The STABLE Act also establishes a federal-level stablecoin issuance licensing system and provides diversified compliance paths for different types of issuers. This institutional arrangement not only continues the federal-state dual-track structure of the U.S. financial regulatory system, but also responds to the market's expectations for flexibility in compliance thresholds.
