A picture taken in London shows gold-plated souvenir cryptocurrency tether, bitcoin and ethereum coins arranged beside a screen displaying a trading chart, May 8, 2022.
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But Jeremy Allaire, Circle’s boss and co-founder, hopes that things will change this year, stating that there is a “very good chance” U.S. lawmakers approve a stablecoin bill.
Speaking with CNBC at the World Economic Forum in Davos, Switzerland, Allaire said regulatory developments around the crypto industry were picking up around the world, and that the U.S. was more than likely to approve laws for stablecoins than before.
“I think what you’re seeing is a desire from the administration, a desire from the Treasury, from the [Federal Reserve], by both chambers of Congress, and certainly on a bipartisan basis,” Allaire told CNBC Monday.
“Digital dollars are happening around the world, other governments are regulating dollar-digital currencies before the United States. And so I think there is a very strong desire to act and assert U.S. leadership and get the right consumer protections involved,” Allaire added.
Allaire was asked about the Clarity for Payment Stablecoins Act, which seeks to bring stablecoins within the same regulatory frameworks that govern traditional financial services companies.
The act was passed by the House Financial Services Committee in 2023, moving it to the floor of the House of Representatives for consideration. It has yet to be approved lawmakers in the House.
Circle recently filed its confidential S-1 registration with the U.S. Securities and Exchange Commission, showcasing the company’s intention to list publicly. The firm did not give away any information on the timing of its IPO, which came the same week that the SEC approved the first U.S. spot bitcoin ETFs.
Allaire, asked about whether the timing of Circle’s listing was in response to the SEC’s ETF approval, said he couldn’t comment on the development due to regulatory restrictions.
Crypto had a buoyant year in 2023 with markets seeing a major recovery, and industry insiders are hoping for an even more fortunate 2024 for the industry.
“Stablecoins in particular remain the killer app for blockchain technology,” Allaire told CNBC. “We’re starting to see widening usage all around the world.”
“It’s been a really powerful time for that and we think 2024, with things like the spot ETF and world regulatory clarity, is going to open this up even wider.”
Dante Disparte, Circle’s chief strategy officer and global head of public policy, echoed Allaire’s view that 2024 would be the year that the U.S. sees rules for stablecoins coming in.
“I remain optimistic that payments stablecoin policy is a possibility early in the new year. And that is increasingly a bipartisan reality, in no small measure,” Disparte told CNBC’s MacKenzie Sigalos on the sidelines of Davos.
Disparte suggested that concerns around illicit usage of some cryptocurrencies could spur U.S. lawmakers on to bring stablecoin laws into place, as stablecoins provide more of a legitimate use case for everyday purchases and trade compred to their more volatile neighbors in crypto, which have been associated heavily with criminal activity.
“You’ve seen in the conflict in the Middle East, for example, the use of certain digital assets in the space as a vehicle for funding terrorism,” Disparte said.
“Domestically in the United States, you can see the use of certain assets in the space as a vehicle for funding fentanyl trafficking, and worse, all of those types of illicit actions that are bad for the U.S. dollar are bad for the U.S. economy, bad for the sector, bad for banking and payments, and bad for people,” Disparte said.
“Unless that is addressed, that would be against the interest of the country [and] the economy. So I remain optimistic that this will be a year where policymakers actually get around to doing something affirmatively on stablecoins, as opposed to through enforcement,” Circle’s policy chief added.
—CNBC’s MacKenzie Sigalos contributed to this article.
