Rep. Maxine Waters (D-CA), the top Democrat on the House Financial Services Committee, is pushing for a “grand bargain” on stablecoin legislation before the end of the year, aiming to resolve two years of debates in Washington over the regulatory framework for stablecoins.

What Happened: Waters, alongside Rep. Patrick McHenry (R-N.C.), the Republican chair of the committee, has been working since 2022 on legislation that would establish clear guidelines for stablecoin issuance and regulation, The Block reported.

While the bill advanced out of the Republican-led committee last year, it has struggled to gain broader support.

Waters previously described the bill as “deeply problematic” due to a provision that allows state regulators to approve stablecoin issuances without involvement from the Federal Reserve.

During a House Financial Services Committee hearing on Tuesday, Waters expressed her optimism about reaching an agreement that balances consumer protection with federal oversight.

“Mr. Chairman, before the end of this year, I want us to strike a grand bargain on stablecoins and other long overdue bills,” Waters said, noting that both sides have made significant concessions in the negotiation process.

She emphasized that the legislation must ensure that stablecoins are backed by secure reserves, such as short-term Treasury bills, to ensure their stability.

“The Federal Reserve needs to have a dominant role,” Waters added, stressing the importance of federal involvement similar to other countries’ approaches.

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Waters also extended a challenge to her Republican colleague, saying, “I’ve made a public statement to you about bipartisanship — let’s see what you do with it.”

McHenry, who has been leading efforts on digital asset regulation, echoed his support for stablecoin legislation and stressed the need for broader clarity on digital assets.

He also expressed hope that his separate crypto market structure bill, FIT21, could gain momentum by the end of the year, especially as his retirement in January looms.

With time running out for legislative action in Congress this year, pressure is mounting to finalize a stablecoin regulatory framework.

The stakes are particularly high as the committee continues to discuss key digital asset issues, with all five commissioners of the U.S. Securities and Exchange Commission (SEC), including Chair Gary Gensler, testifying at the Tuesday hearing.

Lawmakers grilled the commissioners on the SEC’s approach to digital assets, rulemaking, and oversight.

What’s Next: These discussions, along with the future of stablecoin regulation, will be central topics at the upcoming Benzinga Future of Digital Assets event on Nov. 19.

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