According to reports, the Biden government is considering a new regulatory framework for stablecoin issuers with the intention of putting them in the same category as banks.
The Wall Street Journal today news that the Biden administration is trying to convince Congress to create a new “special purpose charter” for stablecoin issuers and other companies in the same category.
While it is not entirely clear what the law will look like, it is expected to specifically regulate these types of business models.
Policy makers have been raising the alarm about stablecoins for the past few months believing that assets pegged to the US dollar are not being properly managed. Earlier this week, Fed chairman Jerome Powell told the Financial Services Commission that stablecoins like Tether (USDT) and USDC Coin (USDC) should be regulated within the same parameters as money market funds like deposits.
However, he continues to insist that there is no ban on Bitcoin or other digital assets. And certainly the US will not act like China against crypto.
Anchorage digital bank CEO Nathan McCauley said this move by the Biden administration could provide much-needed clarity for stablecoins.
“Dollar-denominated stablecoins represent an opportunity to further expand the strategic reach of the United States,” he said. The Biden government was smart to accept stablecoins in this way and to build trust in the industry through regulation. ”
In July, a joint study by the Fed and Yale University outlined two regulatory frameworks for stablecoins in a 49-page report entitled “Taming Wildcat Stablecoins”. In it, the authors argue that policymakers have only two options when it comes to stablecoin regulations: converting them into an equivalent of public money or restricting them through taxes.
Stablecoins have become a $ 128 billion market, according to CoinMarketCap. Of that, USDT makes up more than half of the total market, although competitors like USDC and BUSD have made significant strides this year. As these markets mature, regulators, particularly the US, have concerns about the liquidity and reserve status of stablecoin issuers.
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According to AZCoin News