Sen. Pat Toomey (R-Pa.), has introduced a bill outlining a federal framework for doing so regulate stablecoins – just two weeks before he retires.

What happened?: Aiming to “lead” Congress toward future crypto regulation, Toomey said his bill would create a new federal license for payment stablecoin issuers and allow recipients of the license to issue the digital currency and more.

As the senior Republican on the Senate Banking Committee and an influential figure in crypto policy, Toomey said he was determined to ensure this new license “does not undermine competition by favoring established incumbents.”

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“The digitization of the US dollar and its availability worldwide, instantaneously, and at near zero cost would allow stablecoins to be used in multiple ways throughout the physical economy,” Toomey said.

The Toomey proposal would require payment stablecoin issuers to fully back their coins with “high-quality liquid assets” and also establish new, standardized disclosure requirements. These disclosures include the assets backing the payments stablecoin, redemption policies, and attestations from qualified auditing firms to ensure users receive the greatest possible transparency on their financial instruments.

Why it matters: stablecoins are cryptocurrencies that are designed to have a constant price and are pegged to a fiat currency like the dollar. Some examples of stablecoins are tether USDT/USD and USD coin USDC/USD. Toomey was also one of two lawmakers who submitted an invoice to the US Senate in July to exempt small cryptocurrency transactions from capital gains tax.

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