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Monopoly-US Treasury Discusses Cryptocurrency “Stablecoin” in Financial Industry

File Photo: The US Treasury will be seen on August 30, 2020 in Washington, DC, USA.Reuters / Andrew Kelly

September 10, 2021

Pete Schroeder

Washington (Reuters) – The US Treasury met with many industry participants this week to ask about the risks and benefits of stablecoin. Stablecoin is a fast-growing type of cryptocurrency whose value is fixed to traditional currencies. Someone who knows the meeting directly.

Washington policymakers are wary of the rapidly expanding crypto market, which surpassed a record $ 2 trillion in April. As of Friday, stablecoin had a market capitalization of approximately $ 125 billion, according to industry data site CoinMarketCap. It is unclear which financial regulations apply to these relatively new products.

U.S. financial regulators are working to understand the risks and opportunities that cryptocurrencies pose to the traditional U.S. financial system and will publish numerous reports on this subject in the coming months. Says.

In July, Treasury Secretary Janet Yellen said the government must act swiftly to establish a regulatory framework for Stablecoin.

Treasury officials met with financial industry executives this week to discuss the potential for stablecoin regulation as a sign that these efforts are accelerating, according to three sources.

Two people said at this week’s meeting, one of them was held on Friday, and authorities asked if stablecoin needed direct surveillance if it became very popular. They also discuss how regulators try to mitigate the risk of too many people trying to monetize stablecoin at the same time, and whether major stablecoins should be backed by traditional assets. Did.

Officials also asked about how stablecoins should be constructed, how they could be used, whether the current regulatory framework is sufficient, and other safety and health issues. , One said.

Others said the treasury authorities also met with groups of banks and credit unions earlier this week to discuss similar issues. Treasury officials seemed to be collecting information and did not share ideas on how to regulate stablecoin, he added.

The information gathered at this week’s meeting could help form an extensive financial report on stablecoin expected in the coming months.

In a statement, Treasury spokesman John Rizzo said the agency was investigating “the potential benefits and risks of stablecoin for users, markets, or the financial system.”

“As this work continues, the Treasury is meeting with a wide range of stakeholders, including consumer advocates, lawmakers and market participants,” he added.

Washington policymakers are concerned that the rise in private currencies could undermine the control of the financial and monetary system, increase systemic risk, foster financial crimes and hurt investors. ..

The US Securities and Exchange Commission, the Commodity Futures Trading Commission, the Federal Reserve Board, and the Office of the Comptroller of the Currency are also working on cryptocurrency projects, they said.

(Written by Michelle Price, edited by Lauren Lacapra and David Gregorio)



Monopoly-US Treasury Discusses Cryptocurrency “Stablecoin” in Financial Industry

Source link Monopoly-US Treasury Discusses Cryptocurrency “Stablecoin” in Financial Industry

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