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The country’s main financial regulators met on Monday to discuss stablecoins, with Treasury Secretary Janet Yellen stressing “the need to act quickly to ensure an appropriate US regulatory framework is in place” for these digital assets, said the Treasury Department said in a statement.
Participants discussed stablecoins, a type of digital currency pegged to the US dollar. They are popular with BTCUSD bitcoin investors,
ether ETHUSD,
and other cryptocurrencies because their stable value makes them useful for trading other generally volatile digital assets. Popular stablecoins include the USDTUSD clip,
USD coin USDCUSD,
and dai DAIUSD,
Read more: US Needs ‘Strong Regulatory Framework’ For Stablecoins, Fed’s Powell Warns Crypto Investors
Topics for discussion included “the rapid growth of stablecoins, the potential uses of stablecoins as a means of payment, and the potential risks to end users, the financial system, and national security,” the Treasury Department said.
Critics say stablecoins pose a threat to financial stability as investors use them as cash substitutes, but they remain lightly regulated, unlike similar products like bank deposits or money market mutual funds. . Federal Reserve Chairman Jay Powell last week told a congressional hearing that regulators should treat stablecoins the same as these instruments.
Yellen, Powell, Chairman of the Securities and Exchange Commission Gary Gensler, Acting Chairman of the Commodity Futures Trading Commission Rostin Behnam, Chairman of the Federal Deposit Insurance Corporation Jelena McWilliams, Acting Comptroller of the Currency Michael Hsu, the Under Secretary of the Treasury for Home Finance Nellie Liang and Randal Quarles, Fed vice president in charge of oversight.
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