A US Securities and Exchange Commission (SEC) commissioner expects to see stricter regulations for stablecoins. However, Finance Minister Janet Yellen says stablecoin is currently “not a real threat” to the country’s economic stability.
SEC Commissioner for the Stablecoin Regulation
The regulation of stablecoin was a hot topic this week after the Terra fiasco that saw the UST lose its bond in US dollars and the LUNA sink to almost zero.
U.S. Securities and Exchange Commission (SEC) commissioner Hester Peirce spoke about the regulation of cryptocurrencies on Thursday during an event organized by the official think tank of official monetary and financial institutions based in London.
Peirce, known in the cryptocurrency community as the “mom of cryptocurrencies,” said stricter regulations on cryptocurrencies, especially fixed currencies, could come soon. She allegedly said:
One place we can see some movement is around stablecoins… This is an area that has obviously caught a lot of attention this week.
Lawmakers will work with the Treasury to regulate Stablecoin
US lawmakers have stressed the urgent need to regulate stablecoin. In a statement to the Senate Banking, Housing and Civil Affairs Committee this week, Treasury Secretary Janet Yellen said it was important and urgent for Congress to pass legislation governing stablecoins.
Yellen also testified before Parliament’s Financial Services Committee this week, stating that for stablecoins:
I would not characterize it on this scale as a real threat to financial stability, but they are growing very fast and presenting the same risks we have known for centuries in relation to banking.
Both the Financial Stability Supervisory Board (FSOC) and the US Federal Reserve Board have warned of the dangers of running stablecoin that threaten the country’s financial stability.
Do you think stablecoins need to be adjusted urgently? Let us know in the comments section below.
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