(a)
Notwithstanding subdivision (a) of Section 3601, a covered person may exchange, transfer, or store a stablecoin or engage in digital financial asset administration of that stablecoin, whether directly or through an
agreement with a digital financial asset control services vendor, if that stablecoin is approved by the commissioner pursuant to subdivision (b), provided that the covered person complies with any requirements, restrictions, or prohibitions established by the commissioner pursuant to subdivision (c).
(b)
(1)
The commissioner may approve a stablecoin for exchange, transfer, or storage by a covered person, or for issuance pursuant to digital financial asset administration, if the commissioner determines that the stablecoin does not compromise the interests of residents who may use the stablecoin as a payment for goods and services or as a store of value.
(2)
In determining whether to make an approval under paragraph (1), the
commissioner shall consider all of the following factors:
(A)
Any legally enforceable rights provided by the issuer of the stablecoin to holders of the stablecoin, including, but not limited to, rights to redeem the stablecoin for legal tender or bank or credit union credit.
(B)
The amount, nature, and quality of assets owned or held by the issuer of the stablecoin that may be used to fund any redemption requests from residents.
(C)
Any risks related to how the assets described in subparagraph (B) are owned or held by the issuer that may impair the ability of the issuer of the stablecoin to meet any redemption requests from residents.
(D)
Any representations made by
the issuer of the stablecoin related to the potential uses of the stablecoin.
(E)
Any representations made by the issuer of the stablecoin related to the risks of using the stablecoin as payment for goods or services or as a store of value.
(F)
Any other factors the commissioner deems material to making their determination.
(c)
(1)
As a condition of providing an approval pursuant to subdivision (b), the commissioner may require the stablecoin issuer to obtain a license under Section 3203 and may impose additional requirements, restrictions, or prohibitions on the activities of the issuer of the stablecoin in order to protect the interests of residents who may use the stablecoin as payment for goods or
services or as a store of value.
(2)
The commissioner may impose additional requirements, restrictions, or prohibitions on the activities of a covered person exchanging, transferring, or storing an approved stablecoin or engaging in digital financial asset administration of an approved stablecoin, whether directly or through an agreement with a digital financial asset control services vendor, in order to protect the interests of residents who may use the stablecoin as a payment for goods or services or as a store of value.
(d)
(1)
The commissioner shall revoke an approval under subdivision (b) if, after notice and reasonable opportunity to be heard, the commissioner determines that the issuer of the stablecoin markets the stablecoin in a manner that may
create a reasonable expectation or belief among the general public that the stablecoin poses no more risk to a holder or user of the stablecoin than the risks posed to the holder or user of bank credit or a stored value product issued by a person licensed pursuant to Division 1.2.
(2)
The commissioner may revoke an approval under subdivision (b) if, after notice and reasonable opportunity to be heard, the commissioner makes any of the following determinations:
(A)
Changes in the activities of the covered person or the issuer of the stablecoin relative to the commissioner’s understanding of those activities when the commissioner made the approval may compromise the interests of residents who use or hold the stablecoin.
(B)
Changes in market conditions within the financial system or within markets for digital financial assets relative to the commissioner’s understanding of the financial system or the markets when the commissioner made the approval may compromise the interests of residents who use or hold the stablecoin.
(C)
The covered person or the issuer violates any requirement, restriction, or prohibition imposed by the commissioner pursuant to subdivision (c) or any other provision, requirement, rule, or
regulation under this chapter.
(e)
If the commissioner approves a stablecoin pursuant to this section, the commissioner shall make available on the department’s internet website the approval.
