Janet Yellen – the current US Treasury Secretary – has called on US financial regulators to introduce new rules for stablecoins. He believes that this type of cryptocurrency is spreading rapidly and that authorities should “act quickly.”
Janet Yellen: Stablecoins need a suitable regulatory framework
Bloomberg posted that during a recent meeting of the working group for financial markets, US Treasury Secretary Janet Yellen warned that stable coins were not properly supervised in the United States. Legislators therefore need to “act quickly” and bring them into the regulatory framework. The Ministry of Finance stated:
“The Secretary stressed the need to act swiftly and ensure that there is an appropriate US regulatory framework.”
At the meeting, US officials also discussed the rapid growth of stablecoins, their potential benefits as a method of payment, and the potential risks they may pose to the financial system and end users. Leading US regulators should issue a plan to close regulatory gaps around these digital assets in the coming months.
While cryptocurrencies such as BTC, ETH, DOGE and many others can be attractive investment opportunities, they can also be volatile and therefore high risk. Stablecoins, on the other hand, are designed to offer greater security because they are tied to hard assets such as national currencies or precious metals.
Last week, the chairman of the Federal Reserve – Jerome Powell – also tasted the issue of digital currencies and their proper regulation. He said the Fed would release a report in September that would include virtual assets, stablecoins and CBDC:
“We will focus on digital payments more widely. That means stablecoins, that means crypto assets, that means CBDC. We will address the whole group of issues and payment mechanisms that we think are really at a critical juncture. “
Stricter rules for stablecoins are also demanded by China and Japan
The People’s Bank of China has recently expressed concern that digital currencies, especially stablecoins, could negatively affect the global financial system. The deputy governor of the institution – Fan Yifei – even described them as “speculative tools:”
“Some commercial organizations, the so-called stablecoins, especially global stablecoins, can bring risks and challenges to the international monetary system, the payment and settlement system, etc. ”
The Japanese government is also considering the need to regulate stablecoins more tightly, as some authorities believe they pose a threat to the country’s financial stability.