U.S. Reps Unveil Bipartisan Crypto Bill That Enables Ripple, Circle, Access Fed’s Payment Rails

U.S. Representatives Young Kim and Sam Liccardo have introduced a bipartisan crypto bill that would enable regulated U.S. crypto firms such as Ripple and Circle to access the Fed’s payment rails. The lawmakers noted that the bill aims to make everyday payments faster and cheaper for Americans, with stablecoins gaining ground as the solution.

U.S. Reps Introduce Bipartisan PACE Crypto Bill For Payments

In a press release, the U.S. Reps announced they have introduced the Payments Access and Consumer Efficiency (PACE) Act to help Americans send and receive money faster and more cheaply by modernizing how payment companies access payment rails. The lawmakers noted that the current payment system has multiple layers that slow payments and make them more expensive.

As such, they aim to use this crypto bill to address this problem by enabling qualified providers to access federal payment systems directly, thereby reducing delays and lowering costs for consumers and small businesses.

Commenting on the bill, Rep. Liccardo noted that they can reduce the burden of bank fees by enabling broader access to innovative payment systems that deliver cheaper, faster, and more reliable service. It is worth noting that the Financial Technology Association. Blockchain Association, The Digital Chamber, and The Crypto Council for Innovation have all endorsed the crypto bill.

Summer Mersinger, CEO of the Blockchain Association, noted that crypto payment companies have, for too long, been locked out of the same financial infrastructure that their competitors have access to. “The PACE Act allows qualified nonbank providers to obtain direct access to Federal Reserve payment rails, enabling faster, less expensive, and more competitive payment services for American consumers and businesses,” she added.

Crypto firms such as Ripple and Circle are currently awaiting the Fed’s proposed skinny master accounts, which would grant them access to the U.S. central bank’s payment rails. Notably, Crypto exchange Kraken has secured a Fed master account, making it the only crypto firm that has access to the Fed’s payment rails.

Key Provisions Of The Act

The crypto bill provides for streamlined federal registration, ensuring that qualified payment companies can apply with clear standards and review deadlines. Furthermore, it provides strong consumer protections, as payment firms must fully back consumer funds and keep them separate from company assets.

These consumers will also have priority when recovering funds if the company were to fail. Meanwhile, the PACE Act also recognizes the skinny master accounts and gives the Fed Board final decision-making over skinny master account applications.

The introduction of this crypto bill comes amid a setback for the CLARITY Act, another crypto bill that provides clarity for the crypto industry and boosts crypto payments. The banking and crypto industries are currently clashing over stablecoin rewards, with the former arguing that such rewards will trigger deposit outflows.

Interestingly, the bank has also opposed granting crypto firms access to the Fed’s payment rails. The Colorado Bankers Association warned that the skinny master accounts could “open up a window for expedited fraud.”