A commissioner at the US Securities and Exchange Commission (SEC) expects stricter regulation on stablecoins. However, Treasury Secretary Janet Yellen says stablecoins currently pose “no real threat” to the country’s financial stability.
SEC Commissioner for Stablecoin Regulation
The regulation of stablecoins was a hot topic this week after the Terra fiasco, with UST losing its US dollar peg and LUNA falling to near zero.
A commissioner at the U.S. Securities and Exchange Commission (SEC), Hester Peirce, spoke on cryptocurrency regulation Thursday at an event hosted by the London-based official think tank on policy for monetary and financial institutions.
Peirce, who is known in the crypto community as “crypto mother,” indicated that stricter regulations for cryptocurrency, especially stablecoins, could be coming soon. She was quoted as saying:
One place where we might see some movement is around stablecoins… That’s one area that has clearly gotten a lot of attention this week.
Lawmakers Collaborate With Treasury Department On Stablecoin Regulation
US lawmakers have emphasized the urgent need for stablecoin regulation. In her testimony this week before the Senate Committee on Banking, Housing and Urban Affairs, Treasury Secretary Janet Yellen emphasized the importance and urgency for Congress to pass legislation regulating stable coins for payments.
Yellen also testified before the House Financial Services Committee this week, stating that for stablecoins:
I wouldn’t characterize it at this scale as a real threat to financial stability, but they are growing very fast and they carry the same kind of risks that we have known for centuries associated with bank runs.
Both the Financial Stability Oversight Council (FSOC) and the Federal Reserve Board have warned of the risks of stablecoin runs threatening the country’s financial stability.
Do you think stablecoins need to be regulated urgently? Let us know in the comments below.
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