Top Democrats: 'Deeply Concerned' About PayPal's New Stablecoin

Author: Nelson Wang, CoinDesk; Compiler: Songxue, Jinse Finance

Rep. Maxine Waters, D-Calif., issued a statement Wednesday saying she** is “deeply concerned that PayPal has chosen to launch its own stablecoin and that there remains no federal framework to regulate, oversee and enforce these assets.”**

PayPal launched a new dollar-backed stablecoin, PYUSD, on Monday, the first time a global payments company has issued its own stablecoin.

House Financial Services Committee Democratic leader Waters pointed out that PayPal has 435 million customers worldwide, more than the sum of the online accounts of all the largest banks.

Waters wrote: “Given PayPal’s size and reach, federal oversight and enforcement of its stablecoin operations is critical to safeguarding consumers and alleviating financial stability concerns.”

A House committee recently approved legislation seeking to create controls for the United States. The bill is now eligible for a vote in the House, although even if approved there, it is unlikely to receive a warm welcome from Senate Democrats.

**Waters criticized the Republican-sponsored bill that approved stablecoins issued under state authority, such as PYUSD, but prevented the Fed from regulating them. **

She added: “Additionally, the Republican bill weakens the Fed’s role as a central bank, making it harder to protect the economy from inflation or support maximum employment if stablecoins are widely adopted.”**

In contrast, Rep. Patrick McHenry of North Carolina, chairman of the ** House Financial Services Committee, expressed support for PayPal’s new stablecoin in a statement released on Monday. **

“This announcement is a clear signal that stablecoins — if issued within a clear regulatory framework —** have the potential to become the backbone of our 21st century payments system,” McHenry wrote.**