There is no law that bans U.S. banks from issuing paper or digital private banknotes, American Institute for Economic Research senior fellow Thomas Hogan writes.

As the law currently stands, no legislation appears to be necessary for banks to issue stablecoins. The practice is not legally prohibited. If Congress or regulatory agencies wish to prohibit the issuance of stablecoins by U.S. banks, they must pass new laws or regulations to do so. Congress can help clarify the current legal ambiguity and ensure that safe, transparent stablecoin issuance continues to be allowed.