MoonPay Urges Congress: Let States Regulate Stablecoins

Why MoonPay’s CEO Wants States to Keep Regulating Stablecoins

The growing conversation around stablecoin regulation in the United States is heating up, and one prominent voice from the crypto world is stepping into the debate. Ivan Soto-Wright, CEO of leading crypto payments company MoonPay, has made a direct appeal to U.S. lawmakers: don’t sideline state-level regulators in the race to legislate stablecoins.

As Congress debates two major bills  the GENIUS Act in the Senate and the STABLE Act in the House  Soto-Wright is advocating for a hybrid approach that preserves the role of state authorities. His message is simple yet impactful: while federal oversight may streamline certain aspects of regulation, state regulators have been the unsung heroes of crypto innovation and consumer protection.

Let’s break down what this means for the crypto industry, why this debate matters, and how these upcoming laws could reshape the stablecoin ecosystem.

A Quick Refresher: What Are Stablecoins?

Stablecoins are a category of cryptocurrencies designed to maintain a stable value, typically pegged to fiat currencies like the U.S. dollar. They play a critical role in the digital asset economy, enabling smoother transactions, reducing volatility, and allowing easier entry and exit points for both retail and institutional investors.

Popular stablecoins like Tether (USDT), USD Coin (USDC), and DAI are used across crypto exchanges, decentralized finance (DeFi) platforms, and payment apps globally. However, due to their increasing influence in the financial system, they’ve also caught the attention of global regulators, including in the U.S.

 The GENIUS Act & STABLE Act What’s on the Table?

Lawmakers are currently reviewing two key legislative proposals:

• The GENIUS Act (Guiding and Establishing National Innovation for US Stablecoins): Focused on setting a federal framework for stablecoin regulation while still offering state pathways.

• The STABLE Act (Stablecoin Transparency and Accountability for a Better Ledger Economy): Aimed at increasing oversight and transparency in how stablecoins are issued and maintained, particularly ensuring reserves back the coins.

Both bills propose a dual-track model one that allows federally approved issuers and also recognizes permitted stablecoin issuers (PSIs) regulated at the state level. However, the exact balance of power between federal and state agencies remains under discussion.

MoonPay CEO: “Don’t Undercut the States”

In a post on social platform X (formerly Twitter) dated April 18, Ivan Soto-Wright made a direct appeal to Congress: “As federal legislation now approaches the finish line, it is essential to preserve viable state pathways for PSIs that place the state regulators who meet the standards set out in GENIUS and STABLE on equal footing with federal regulators.”

He emphasized that while the crypto industry has long called for a national regulatory framework, it’s the states that have done the hard work so far. State agencies provided early guidance, licensing structures (like New York’s BitLicense), and enforcement clarity all crucial for consumer protection and innovation.

This view aligns closely with that of the Conference of State Bank Supervisors (CSBS), which sent a letter to the House Financial Services Committee on April 1 recommending a cooperative state-federal oversight model for stablecoins.

Why This Matters for the Crypto Sector

The outcome of this debate could have far-reaching implications:

• Innovation vs. Oversight: Federal regulation may bring consistency, but it could also stifle innovation if states are pushed out. Crypto startups often rely on state-level licenses to operate and experiment with new models.

• Consumer Trust: Regulations whether state or federal help foster user confidence in digital currencies. If done right, a balanced model could boost adoption across the board.

• Competitive Landscape: Allowing both state and federal pathways could create a competitive environment, pushing both levels of government to craft better, clearer frameworks.

Global Context: A Worldwide Push for Stablecoin Rules

The U.S. isn’t alone. Globally, financial regulators are working to establish guidelines for stablecoins. For instance:

• The European Union’s MiCA (Markets in Crypto-Assets) framework includes specific provisions for e-money tokens (stablecoins).

• The UK’s Financial Conduct Authority (FCA) recently closed consultations on crypto oversight, with stablecoins high on the priority list.

• Asian markets like Singapore and Japan are also actively developing regulatory paths for fiat-backed tokens.

As one of the world’s largest financial markets, how the U.S. handles stablecoins will likely influence global norms.

The Business Case for State Involvement

From a business perspective, keeping states in the mix could be a big win:

• Flexibility: Startups can tailor compliance strategies to states where they have operational advantages.

• Speed: State-level approvals are often faster than federal processes.

• Proven Models: Some states have already built robust frameworks, like Wyoming’s digital asset laws and New York’s BitLicense program.

MoonPay’s argument isn’t to resist regulation it’s to avoid centralizing it so much that it becomes rigid and overly bureaucratic.

What Comes Next?

Both the Senate Banking Committee and the House Financial Services Committee have already advanced the GENIUS and STABLE Acts through preliminary stages. The next step is full floor votes, which could happen later this year.

If passed, these laws would mark a significant turning point in U.S. crypto policy, defining not just how stablecoins are regulated but also who gets to do the regulating.

For now, the industry is watching and lobbying closely.

Final Thoughts

MoonPay’s call to action underscores a bigger theme in crypto policy: regulation doesn’t have to mean centralization. States have long been partners in financial innovation, and sidelining them could harm both consumer protection and growth. As the U.S. shapes its stablecoin laws, striking a balance between state and federal oversight will be key to fostering a thriving, secure digital asset ecosystem.

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