Compilation of the original text: Deep Tide TechFlow
Compilation of the original text: Deep Tide TechFlow
As soon as the news came out, I saw a lot of people panicking about $Frax and $FXS. While I think this concern is justified, let's take a closer look at another article from TheBlock, which seems to give more detail.
First, the article from The Block says,"The bill would impose a two-year ban on stablecoins that are not fully backed by cash or highly liquid assets such as U.S. Treasuries."
Since the UST crash, the goal of the Frax team has been to make $FRAX 100% collateralized. The current mortgage rate has reached 92%, and if this bill is really passed, it will not be a big problem to reach 100%.
The Block also noted that,"The bill also creates a two-year grace period for projects not currently fully collateralized to change their business model and obtain approval."So even if the bill is passed, two years is enough for Frax Finance to meet any laws and regulations.
Another thing to note is that the bill has not yet passed.
While anything is possible, most draft bills are unlikely to pass without extensive revisions, so I think it's too early to go into a full-blown panic.
It is worth noting that,"According to sources familiar with The Block's access to the draft text,Issuers of non-bank stablecoins backed by fiat currencies would also be subject to oversight by state banking regulators and the Federal Reserve."I'm not sure what the process will be, but we're going to have to see extremely onerous regulation.
Bloomberg’s original article states,"Issuing or creating new endogenously collateralized stablecoins would be illegal"。
I knowSome may interpret this as the old algorithmic stablecoins getting a free pass from now on, but I don't think we can confirm that yet.
This could simply mean that current algorithmic stablecoins can no longer mint the stablecoins outlined in the bill, we need more information.
If the bill passes, it shouldn't be hard to get $FRAX fully supported.
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