Overnight Finance

On The Money — House panel mulls future of ‘stablecoin’ rules

Happy Tuesday and welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. Subscribe here: thehill.com/newsletter-signup.

Today’s Big Deal: Lawmakers are trying to figure out how federal financial rules should be adapted for stablecoins. We’ll also look at a step forward toward avoiding a shutdown and some big endorsements for President Biden’s Federal Reserve nominees.

But first, a guide to the Oscar nominations.

For The Hill, we’re Sylvan Lane, Aris Folley and Karl Evers-Hillstrom. Reach us at slane@thehill.com or @SylvanLane, afolley@thehill.com or @ArisFolley and kevers@thehill.com or @KarlMEvers.

Let’s get to it.

Lawmakers clash over how to regulate crypto

House lawmakers debated Tuesday whether the federal government should force “stablecoin” issuers to adhere to strict federal bank regulations and insurance to limit the risks of a quickly growing segment of the cryptocurrency market. 

Members of the House Financial Services Committee pressed a top Treasury Department official on the Biden administration’s suggested framework for regulating cryptocurrencies tied to fixed value.  

  • Stablecoins are meant to be a safe haven amid volatile cryptocurrency markets and help create a bridge between digital tokens and traditional commerce.  
  • They have also drawn bipartisan interest as a cheaper and more accessible way to send money or make transactions outside of the traditional financial system and across international lines. 

But both parties generally agree federal law must be updated to give stablecoin issuers clear standards meant to keep consumers safe and the broader financial system stable.

Sylvan has more here.

LET’S DO A DEAL

House passes short-term funding bill to avert shutdown 

The House on Tuesday passed a stopgap measure to extend federal government funding until March 11 to prevent a shutdown next week while negotiations over a longer-term package remain ongoing.

The chamber voted 272-162 to pass the short-term funding bill on Tuesday, just one day before the House is set to be out of session until the week of Feb. 28. A total of 51 House Republicans joined all but one Democrat in support of the measure.

  • The legislation buys congressional negotiators on both sides of the aisle time to strike a larger spending deal known as an omnibus to fund government operations for the rest of the fiscal year, which ends in late September. 
  • If passed by the House and Senate, the continuing resolution will mark the third time Congress has had to resort to such measures to prevent a shutdown for the current fiscal year that began Oct. 1, as lawmakers struggle to reach a bipartisan agreement on spending.
  • The House, where Democrats hold the majority, has so far passed 9 out of 12 of its annual appropriations bills. But none have passed in the 50-50 split Senate, where Democrats would need the support of all the party’s members and 10 Republican votes to pass such legislation. 

The Senate is expected to act swiftly on the legislation.  

Leaders on both sides of the aisle have their sights set on securing a deal on a massive omnibus spending package for fiscal 2022, but disagreements in major areas, including defense and nondefense spending, as well as policy riders, have slowed efforts. 

Aris and The Hill’s Cristina Marcos have more on this here.  

More coverage from The Hill: Lawmakers say spending deal up to leaders 

GET YOUR CTC

White House encourages public to file taxes to access child tax credit

The White House and Democrats are encouraging citizens to get an early start on their tax returns to take advantage of the party’s expansion of the child tax credit, as well as the earned income tax credit for childless workers.

Biden administration officials hosted a Day of Action event on Tuesday to spread awareness of both credits, while encouraging the millions eligible for access to file their taxes. Democrats expanded both credits under a sweeping coronavirus relief package President Biden signed into law in early 2021.

  • Under the expansion, Democrats removed work requirements for the child tax credit and increased the maximum amount families could receive. The temporary expansion also allowed eligible families to access half of the credit via monthly payments.  
  • Proponents have credited changes made to the child tax credit under the expansion as significant contributors to reducing child poverty.  

Aris has more here.

NEW ENDORSEMENTS

Biden Fed picks get boost from dozens of economists

A group of 180 economists wrote to Senate and committee leadership on Tuesday voicing support for President Biden’s Federal Reserve nominees and urging the chamber to confirm them quickly, as some of the picks faced scrutiny from Republican lawmakers.

The list of signatories includes several prominent economists, including former Federal Reserve chairman Ben Bernanke and former vice chairman of the Federal Reserve Alan Blinder.

  • The economists said that Biden’s five pending nominees are “highly qualified” and stressed that their confirmation is critical to the stability of the U.S. economy.
  • The letter comes as Republican senators scrutinize Sarah Bloom Raskin, Biden’s pick for vice chair, over her work at a fintech firm and her stance on climate change.

The Hill’s Morgan Chalfant has more here.

 

Good to Know 

President Biden on Tuesday lauded a new facility to build chargers for electric vehicles in Tennessee as the latest sign of a “manufacturing comeback” in the U.S.

Australian firm Tritium announced that it will build a U.S. manufacturing plant with the capacity to build over 10,000 fast-charging units per year. The plant will have room to expand to building 30,000 units per year and plans to employ more than 500 people over the next five years. 

Here’s what else we have our eye on: 

  • Sens. Kirsten Gillibrand (D-N.Y.) and Josh Hawley (R-Mo.) introduced a bill that would require large companies to undergo an audit to detect whether they are using forced labor. 
  • Massachusetts Gov. Charlie Baker (R) announced Tuesday the state will begin distributing $500 payments to 500,000 low-income workers.  
  • The White House on Tuesday threw its support behind a burgeoning effort by congressional staffers to unionize.
  • The Department of Justice (DOJ) announced on Tuesday that a married couple was arrested and charged for their alleged links to cryptocurrency stolen from a 2016 hack of Bitfinex, a virtual currency exchange.  

That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you Wednesday.

Tags Joe Biden Josh Hawley Kirsten Gillibrand Maxine Waters

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