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Tougher Stablecoin Rules Coming Soon: Top US Securities Official


US SEC’s Peirce sees ‘movement’ on stablecoin regulation

A senior U.S. Securities and Exchange Commission (SEC) official signaled on Thursday that tougher rules for crypto stablecoins may be on the way.

Cryptocurrency markets are worth around $1 trillion globally this week amid the collapse of stablecoin TerraUSD and a destabilizing drop in Tether, currently the world’s largest stablecoin by market capitalization.

Stablecoins are digital currencies whose values ​​are pegged to traditional assets like the dollar.

Referring to tighter regulations, “one place where we might see movement is in stablecoins,” SEC Commissioner Hester Peirce said in an online debate hosted by the Forum’s policy think tank. official of monetary and financial institutions based in London.

“This is an area that obviously got a lot of attention this week,” Peirce added, noting the potential that stablecoins can have future use in market builds.

She added that the SEC has the ability to capture digital currencies, and the technology platforms on which they are traded, under the agency’s broad regulatory authority.

US Treasury Secretary Janet Yellen told a Senate banking panel this week that the turmoil in crypto markets illustrated the need for a “proper” 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 issues.

SEC Chairman Gary Gensler says agency should address stablecoin risks as asset-linked cryptocurrencies raise financial stability and monetary policy concerns about similar characteristics and potentially in competition with bank deposits and money market funds.

He also said there were concerns about their potential use for illicit activities.

But on Thursday, Peirce, the SEC’s only Republican commissioner, said potential regulation should give way to a “trial and error” regulatory framework, saying “some people have suggested it should be at the SEC; others want it to be banking regulators.

“There are different potential options to approach stablecoins…and with experimentation we have to leave room for there to be failure.”

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

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