U.S. Treasury Under Secretary for Domestic Finance Nellie Liang feels that one way or another, regulations for stablecoins need to occur.
Joseph Hall reports at Cointelegraph on a recent FSOC report showing the ubiquity of stablecoins in the crypto market, and Liang’s response, quoting Liang this way:
“If Congress does not enact legislation, the regulators will try to use what authority they have.”
Stablecoins, to be sure are a big part of crypto. The biggest one, Tether, has a volume of $75 billion.
In that context, Hall reports experts are worried about the effects of a potential run on stablecoins and how that might impact American markets.
However, as Hall reports, many feel that Liang’s agency doesn’t have a lot of unilateral power to regulate without the approval of Congress.
What about the SEC?
This summer, we heard new SEC chair Gary Gensler talk very bluntly about stablecoins as potential securities, and the market responded.
There hasn’t been a lot of public reporting on that particular remark since then, but you can find a SEC statement on a Presidential Working Group report November 1 that says this:
“The PWG report highlights a number of recommendations to address these public-policy challenges. While Congress and the public evaluate this report, we at the SEC and our sibling agency, the Commodity Futures Trading Commission, will deploy the full protections of the federal securities laws and the Commodity Exchange Act to these products and arrangements, where applicable.”
So what are the recommendations of the PWG?
Although they are not spelled and not out in the above document, here’s a U.S. Treasury document that provides a bit more detail:
“The President’s Working Group on Financial … recommend(s) that Congress act promptly to enact legislation to ensure that payment stablecoins and payment stablecoin arrangements are subject to a federal prudential framework on a consistent and comprehensive basis.”
Ah yes. Clear as mud. Will they do it? Stay tuned.
