House Republican Proposes A Marijuana-Stablecoin Combo Bill

Representative French Hill, a prominent Republican member of the Financial Services Committee, expressed his willingness to endorse combined legislation linking marijuana banking with stablecoin regulation, provided negotiators can come to an agreement.

House Leadership to Decide on the Bill

During an interview on Bloomberg Television’s “Balance of Power,” Hill indicated that the method of passing such a package would ultimately be determined by House leadership. Hill, who is currently the chair of the subcommittee on digital assets said:

“I would vote for it if it were coupled. I have supported the SAFE Banking Act for nine years in Congress now, which would allow cannabis dealers in states where it’s legal to have access to the banking system. I think it’s a lot easier to catch bad actors and illegal activity if those companies are participating in the banking system.”

The Arkansas Republican noted that lawmakers are nearing a bipartisan consensus on legislation overseeing stablecoins, echoing statements made earlier in the week by leading Democratic figure Maxine Waters.

“Bottom line is we’ve made a lot of progress in the last year,” he said. “Our country will benefit if we can get both of these bills passed.”

Discussions on the matter have involved Waters, Financial Services Chairman Patrick McHenry, and Senate Majority Leader Chuck Schumer, exploring the potential of linking the stablecoin legislation to the imminent Federal Aviation Administration reauthorization.

Senate Banking Chairman Sherrod Brown informed Bloomberg that he could back a stablecoin bill as long as it safeguarded consumers and was linked to two of his key priorities: the marijuana banking bill and legislation aimed at reclaiming compensation from executives of failed financial institutions.

DoJ vs SEC on Stablecoins

A significant development has surfaced in the legal battle, with Binance Holdings and former CEO Changpeng “CZ” Zhao planning to utilize key details from the United States v. Eisenberg lawsuit. These details could challenge the U.S. SEC’s classification of stablecoins like BUSD and USDC as unregistered securities.

The outcome of this case, along with the Department of Justice‘s stance on USDC not being a security, also has the potential to sway the result of Binance’s lawsuit against the SEC.

In the $110 million Mango Markets fraud case, Avraham Eisenberg was guilty of fraud and market manipulation by the jury. However, an exhibit in the US DOJ filing asserts that USDC stablecoin does not qualify as a security under the Howey test