US Treasury Secretary Janet Yellen will hold a meeting with the Biden administration’s financial market working group to discuss stablecoin regulation. Yellen said: “Given the rapid growth of digital assets, it is very important that agencies cooperate to monitor the industry and make any recommendations for the new authorities.”
The U.S. government discusses stablecoin regulation
US Treasury Secretary Janet Yellen announced on Friday her plan to discuss stablecoin regulation. She will hold a Presidential Financial Markets Working Group (PWG) meeting on July 19 to discuss this matter. The Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) will also attend the meeting.
Yellen explained: “Combining regulators will allow us to assess the potential benefits of stablecoins while reducing the risks they may pose to users, the market, or the financial system.” The Minister of Finance elaborated:
In view of the rapid growth of digital assets, it is very important that agencies cooperate to monitor the industry and formulate any recommendations for the new authorities.
According to the announcement, “PWG was established to improve the integrity, efficiency, orderliness and competitiveness of the US financial market.”
Yellen is a member of the PWG and concurrently serves as the chairman of the Federal Reserve System Board of Governors, the chairman of the Securities and Exchange Commission (SEC) and the acting chairman of the Commodity Futures Trading Commission (CFTC).
The discussion will be based on the “Statement on Key Regulatory Issues Related to Certain Stablecoins” issued by the PWG in December 2020.
Among other things, the document explains: “Based on its design and other factors, stablecoins may constitute securities, commodities, or derivatives subject to U.S. federal securities, commodities, and/or derivatives laws.” It further emphasized that “in Before launching the product on the market, stablecoin participants and arrangements must meet all applicable anti-money laundering and combating terrorist financing (AML/CFT) and sanctions obligations.”
The announcement from the Ministry of Finance added:
The PWG will review the current supervision of stablecoins, identify risks, and make recommendations to address these risks. The PWG expects to issue written recommendations in the next few months.
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