Senate committee hears banking modernization package to define digital assets and regulate stablecoins

The Senate Banking, Business, Insurance and Technology Committee heard two bills intended to modernize Delaware's banking code and create a state regulatory framework for payment stablecoins. Sponsor and the state bank commissioner framed SB 16 as the first of a package to update Title 5 to recognize digital assets and virtual currency, create limited-purpose charters and streamline interstate conversions for banks and trust companies.

The commissioner (introduced in the record as Commissioner Collison) described provisions that add definitions for "digital asset" and "virtual currency," expand the bank commissioner's authority to contract for outside legal, technical and consulting expertise, and allow chartering of limited-purpose institutions that perform specialized functions such as custody or digital-asset management.

Committee members asked about the fiscal note's estimate of roughly $180,000 in startup retainer costs for outside expertise; the commissioner said that figure is a round monthly-retainer estimate based on comparable engagements and that initial costs should taper after regulations and staff training are in place.

Senate Substitute 1 for SB 19 would implement a state licensing and supervision framework for payment stablecoin issuers and certain digital-asset service providers, generally mirroring pillars of the federal GENIUS Act. The substitute requires 1:1 reserves in high-quality liquid assets for payment stablecoins, sets redemption and capital standards, and includes BSA/AML, cybersecurity and custody safeguards. The transcript and witnesses emphasized a preemption approach to avoid conflicting local rules.

Industry witnesses, including representatives from the Delaware Bankers Association, the Delaware Credit Union Association and firms such as JPMorgan Chase, testified in favor of both bills, citing competitiveness, clear supervision and consumer protections. The American Fintech Council also expressed support and said it would file written comments.

Dana Rubinstein of the Delaware Society of Certified Public Accountants raised a concern about language in the substitute that requires attestations by firms registered with the Public Company Accounting Oversight Board (PCAOB). Rubinstein said that, as currently written, only a very small number of PCAOB-registered firms in Delaware could perform the monthly attestations, which could raise costs or create market access barriers for issuers.

Committee members also discussed fee authorities and the separate fee-impact statement for SB 19; control-office staff said fees would be determined through future rulemaking and that the bank commissioner requested additional staff in the fiscal note to carry out expanded duties. Several legislators asked whether the revolving fund referenced in the fiscal note could cover startup costs; control-office staff confirmed the mechanism exists under Delaware law.

No final votes on SB 16 or SB 19 were recorded in the transcript; the hearing record shows robust industry support along with technical questions about staffing, fees and audit/attestation requirements. A committee member asked to be added as a cosponsor to SB 16 during the hearing.