New York state legislators have proposed certain amendments to the law that could allow residents to settle bail bonds in stablecoins instead of fiat currency. The bill could become official six months after the relevant regulators greenlight it.
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Domestic lawmakers have previously introduced legislation that aims to make certain cryptocurrencies an official means of payment for civil penalties, fines, taxes, and other fees.
New York Assembly Bill 7024, presented on May 10, seeks to establish a system for “the administration of the acceptance, recording, and processing of stablecoins as a means of securing bail.” However, the officials did not disclose which assets will be included in the potential legislation.
The lawmakers pointed out the volatile nature of the cryptocurrency market, outlining that the court might require further guarantees if the valuation of stablecoins dropped over 50% from the value when bail was posted.
“If the court directs that bail be posted as provided in paragraph (j) of subdivision of this section and the value of the stablecoins falls more than fifty percent from the value of the stablecoins at the time bail was posted, the court may in its discretion, request the posting of additional bail as provided in subdivision one of this section,” the bill reads.
Stablecoins pegged to fiat currencies or precious metals are supposed to have a fixed price, but there have been some examples of the opposite. USDC (the second largest stablecoin) dropped to as low as $0.87 in March this year after Circle (the company behind the asset) revealed a multi-billion exposure to the collapsed Silicon Valley Bank. The firm fixed the issues in the following days by transferring the funds to another bank, and the token reclaimed its $1 price target.
