US SEC’s Peirce Sees ‘Movement’ on Stablecoin Regulation
A top official at the US Securities and Exchange Commission (SEC) signaled Thursday that stricter regulations on crypto stablecoins could be approaching.
Cryptocurrency markets are worth roughly $1 trillion this week amid the collapse of the TerraUSD stablecoin and a destabilizing plunge in Tether, currently the world’s largest stablecoin by market capitalization.
Stablecoins are digital currencies whose values are linked to traditional assets such as the dollar.
Referring to stricter regulation, “one place where we could see some movement is around stablecoins,” SEC commissioner Hester Peirce said during an online panel debate hosted by the policy think tank of the Official Monetary and Financial Institutions Forum in London.
“That is one area that has clearly received a lot of attention this week,” Peirce added, underscoring the potential for stablecoins to be used in the market in the future.
She added that the SEC has the ability to lock down digital currencies and the technology platforms where they are traded under the agency’s broad regulatory purview.
US Treasury Secretary Janet Yellen told a Senate banking panel this week that the turmoil in crypto markets illustrated the need for an “appropriate” regulatory framework.
President Joe Biden issued an executive order in March requiring the government to assess the risks and benefits of creating a central bank digital dollar, as well as other cryptocurrency concerns.
SEC chairman Gary Gensler has said the agency needs to address stablecoin risks as asset-linked cryptocurrencies raise concerns about financial stability and monetary policy around features similar to and potentially competing with bank deposits and money market funds. .
He has also said there are problems with its possible use for illegal activities.
But on Thursday, Peirce, the SEC’s only Republican commissioner, said potential regulation should make way for a “trial-and-error” regulatory framework, saying that “some people have suggested this should be with the SEC; other people want it to be. the banking regulators.
“There are several possible options for approaching stablecoins… and with experimentation we need to leave room for failure.”
(This story was not edited by DailyExpertNews staff and was generated automatically from a syndicated feed.)
