WASHINGTON — A long-standing dispute between the cryptocurrency industry and traditional banks over stablecoin regulations may soon see a potential resolution, as Senator Thom Tillis (R-NC) is expected to publicly release a compromise proposal in the coming days. According to a Politico report cited by Cointelegraph, however, both sectors remain skeptical of the draft agreement, signaling continued friction over how digital assets should be governed.
The conflict centers on whether stablecoins—cryptocurrencies pegged to fiat currencies like the U.S. dollar—should be subject to banking regulations or treated as a distinct asset class. Banks argue that stablecoin issuers must comply with existing financial oversight to prevent systemic risks, while crypto advocates contend that excessive regulation could stifle innovation.
Analysts suggest the Tillis proposal seeks middle ground by allowing non-bank entities to issue stablecoins under certain conditions while ensuring safeguards against market instability. “This is an attempt to balance innovation with financial security,” said one policy analyst familiar with the discussions, speaking on condition of anonymity.
If adopted, the agreement could pave the way for clearer federal oversight of stablecoins, which have grown into a $150 billion market. Yet, sources indicate that neither side is fully satisfied with the draft, raising doubts about its passage before Congress adjourns.
The outcome could significantly influence the U.S. approach to crypto regulation, particularly as other jurisdictions, including the EU and UK, advance their own frameworks. “This isn’t just about stablecoins—it’s about defining the boundaries between traditional finance and decentralized technologies,” the analyst added.