STABLE Act of 2025: Establishing the U.S. Regulatory Framework for Payment Stablecoins
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As digital assets rapidly evolve, stablecoins have grown increasingly prominent within the financial system. These fiat-backed digital assets now play a vital role in cross-border payments, fund transfers, and financial innovation. However, the rapid expansion of the stablecoin market has also highlighted challenges including insufficient transparency and regulatory gaps.
To address these issues, U.S. Representative Bryan Steil, Chair of the House Subcommittee on Digital Assets, and French Hill, Chair of the Financial Services Committee, introduced the STABLE Act of 2025 (officially titled the Stablecoin Transparency and Accountability Boosting Ledger Economy Act of 2025) in March 2025. This legislation aims to establish a clear legal framework for the issuance, circulation, and oversight of payment stablecoins in the United States. This article provides a detailed breakdown of the bill's key provisions, helping readers understand its objectives, significance, and potential market impact.
1. Core Objectives and Definitions
1.1 Core Objectives
The STABLE Act of 2025 aims to ensure transparency, accountability, and the prevention of illicit financial activities (such as money laundering and terrorist financing) in the U.S. payment stablecoin market. By implementing a stringent regulatory framework, the bill aims to:
Safeguard financial stability;
Protect consumer interests;
Promote compliant digital asset adoption.
Given the financial system's growing reliance on technology, the bill also emphasizes interoperability and market standardization for payment stablecoins, laying the groundwork for stable global digital economic growth.
1.2 Definition of Payment Stablecoins
The bill provides a critical definition of payment stablecoins:
They are defined as digital assets designed for payments or settlements, typically pegged to fiat currencies (e.g., the U.S. dollar).
They include stablecoins that can be redeemed, exchanged, or repurchased at a fixed ratio.
Unlike securities, payment stablecoins function primarily as transactional tools, not investment instruments, and thus are excluded from securities regulation.
2. Issuance and Compliance Requirements for Payment Stablecoins
2.1 Compliance Standards for Issuers
The STABLE Act of 2025 imposes strict requirements for payment stablecoin issuance:
Only federally- or state-approved entities may issue stablecoins.
Eligible issuers include:
FDIC-insured depository institution subsidiaries,
Federally certified nonbank payment stablecoin issuers, and State-certified payment stablecoin issuers.
2.2 Core Compliance Rules
Reserve Requirements: Each stablecoin must be fully backed 1:1 by cash or highly liquid assets (e.g., short-term U.S. Treasuries, bank deposits).
Transparency Requirements: Issuers must publish monthly reserve reports audited by independent CPA firms. Reports must be signed by the CEO and CFO to ensure accuracy.
Redemption Mechanism: Issuers must publicly disclose redemption procedures, allowing holders to convert stablecoins to fiat at the pegged rate.
3. Regulatory Authorities and Cross-Border Compliance
3.1 Primary Regulators
The STABLE Act of 2025 assigns regulatory authority to Office of the Comptroller of the Currency (OCC), Federal Reserve, and Federal Deposit Insurance Corporation (FDIC). Specifically:
Banks and Subsidiaries: Subject to federal regulation.
Credit Unions and Subsidiaries: Supervised by the NCUA.
Nonbank Payment Stablecoins Issuers: Regulated by the OCC.
3.2 Regulation of Foreign-Issued Stablecoins
The STABLE Act of 2025 also outlines the regulatory requirements for foreign stablecoins in the U.S. market:
Foreign issuers must comply with U.S. standards, submit to audits, and align operations with U.S. law.
The Treasury Department may publish a list of qualified foreign issuers to facilitate international cooperation.
4. Penalties and Enforcement
Violations of the STABLE Act of 2025 may result in:
Civil penalties: Up to $100,000 per day for unauthorized issuance of payment stablecoins.
Criminal penalties: 20-year imprisonment and $5 million fines for falsifying reserve reports.
Regulatory actions: Federal agencies may suspend or revoke an issuer's license for violations of the act.
5. Additional Provisions
The STABLE Act of 2025 establishes a comprehensive regulatory framework for payment stablecoins, with the following additional provisions:
Non-Security Classification
Payment stablecoins are excluded from securities regulation, avoiding the complexities of securities laws.
Interoperability Requirement
Federal agencies must develop technical standards to ensure cross-platform compatibility for payment stablecoins.
Transition Periods & Enforcement
Issuers: Must begin compliance within 12 months of enactment.
Custodians: Given 2 years to meet regulatory requirements.
Algorithmic Stablecoin Ban: Takes effect immediately, with enforcement phased in over 2 years.
6. Conclusion
The STABLE Act of 2025 establishes a robust regulatory framework for payment stablecoins, enhancing transparency, consumer protection, and market stability. As the bill progresses, it is expected to provide clearer rules and operational guidelines, bolstering confidence in the U.S. digital asset ecosystem and fostering global economic growth.
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Open the MEXC App and enter "USDE" in the search bar.
Select the USDE/USDT Spot trading pair.
On the chart page, tap Buy, enter your order details (order type, amount, etc.), and confirm by tapping Buy USDE.
Disclaimer: The information provided in this material does not constitute advice on investment, taxation, legal, financial, accounting, or any other related services, nor does it serve as a recommendation to purchase, sell, or hold any assets. MEXC Learn offers this information for reference purposes only and does not provide investment advice. Please ensure you fully understand the risks involved and exercise caution when investing. MEXC is not responsible for users' investment decisions.