A U.S.-based venture capitalist has spoken out against proposals that would restrict international stablecoin issuers from accessing the U.S. treasury market.
Stablecoin Regulatory Battle Emerges in Washington
Vance Spencer, co-founder of Framework Ventures, has criticized attempts to “shut off access to the treasury market for centralized international stablecoin issuers.” According to Spencer, blocking these issuers does not help preserve U.S. dollar hegemony or address America’s national debt problem.
In a post on the social media platform X, Spencer said he hardly talked about regulation but this time felt compelled to do so in order to flag an emerging regulatory battle that is happening in D.C. The venture capitalist’s remarks come amid an ongoing debate about the regulatory framework needed for stablecoins in the United States.
As reported by Bitcoin.com News, one stablecoin bill before U.S. lawmakers requires issuers to hold U.S. Treasuries, particularly short-term Treasury bills. The goal is to ensure the stability of stablecoins and protect consumers from potential losses.
If U.S. lawmakers pass the bills in their current form, stablecoin issuers like Tether, which is based outside the United States, would be required to convert assets, including precious metals and secured loans. Spencer argues that the “soon-to-be revealed stablecoin markup” will make it impossible for overseas issuers like Tether to comply.
In a post on the social media platform X, Spencer explains why such a requirement is unlikely to change the stablecoin market structure.
“The largest stablecoins today are built overseas, and the largest source of demand is overseas – this is not changing no matter what. The net effect of a continued hostile regulatory stance towards stablecoins will only be to regulate ourselves out of the picture like Europe with AI,” Spencer explained.
Proposed Stablecoin Regulation Branded Anti-American
The Framework Ventures co-founder’s criticism of attempts to use regulation to stifle competition is shared by U.S. diplomat Richard Grenell, who identifies the masterminds behind Operation Chokepoint 2.0 as the culprits behind this push. Grenell, a special Presidential Envoy for Special Missions of United States, argues that such a requirement “is not only the wrong path for the U.S. but also completely at odds with MAGA.”
Spencer’s sentiments are also echoed by Chris Buskirk, co-founder and CIO of 1789 Capital, who branded the proposed legislation “straight-up anti-crypto, anti-American, and harmful to national security.”
Meanwhile, Tether CEO Paolo Ardoino criticized rival stablecoin issuers, claiming they are motivated more by a desire to undermine USDT than to build a better product. Without naming names, Ardoino claimed that rival issuers are holding meetings to discuss this objective and vowed to respond to these attacks from competitors.
“Tether won’t stand still, and we won’t let these attacks succeed. We can’t allow it. We’ll stand strong to protect the hundreds of millions of people around the world who are left behind by the traditional financial system, helping them access the U.S. dollar via USDT, while our competitors are ready to endanger these communities in their greedy quest for monopoly. And we have many friends in the process,” Ardoino wrote on X.
