December 6, 2020

A FIRST AMENDMENT PROBLEM WITH THE “STABLE” CRYPTOCURRENCY ACT? To be honest, I read this whole thing as just an entering wedge for a banking industry takeover of cryptocurrency. But this provision struck me as being questionable from a free speech perspective:

(2) USE OF THE TERM ‘DOLLAR’.—A person offering or providing a product or service with respect to a stablecoin may not use the term ‘dollar’ or ‘dollars’ to refer to stablecoin balances unless such reference is pre-approved by either the Comptroller of the Currency or the Board of Governors of the Federal Reserve System.

“Refer to?” I’m no finance expert, but if this means that a crypto exchange or wallet program can’t say that an unlicensed stablecoin balance that’s worth 50 dollars is worth 50 dollars, that strikes me as both dumb and potentially unconstitutional. It’s one thing to ban calling something that’s not a dollar (a stablecoin) a dollar, but if something is truthfully worth 50 dollars, I don’t think the government can prevent someone from saying so.

Possible workaround: Coinbase, Binance, etc. just label stablecoin balances as worth “50 bucks” or “50 smackeroos” or whatever, making this pointless.

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