Fed and Yale researchers lay out 2 regulatory frameworks for stablecoins
Yale Professor Gary B. Gorton and Jeffery Zhang of the Board of Governors of the Federal Reserve System have co-authored a 49-page paper called, “Taming Wildcat Stablecoins.” The Federal Reserve’s ongoing research into central bank digital currencies, or CBDCs, has broadened to include stablecoins and whether they can be effectively regulated. In their paper, which was published in SSRN’s eLibrary on July 17, Gorton and Zhang argue that “privately produced monies” such as stablecoins are “not an effective medium of exchange because they are not always accepted at par and are subject to....
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The United States government appears keen to tame the rapidly growing stablecoin market, according to reports. The Biden administration is reportedly considering a new legal framework for stablecoin issuers that would put them in the same category as banks, raising questions about the future of crypto regulation in the country.Citing people familiar with the matter, The Wall Street Journal reported Friday that the administration is looking to convince Congress to create a new “special-purpose charter” for stablecoin issuers and other companies that fall within the same category. Although....
Patrick McHenry implied that the U.S.' regulation of stablecoins with a “single regulator at the federal level” would likely fail. Whether regulations on stablecoins and digital assets should be addressed at the state or federal level was the topic of discussion among at least two U.S. lawmakers in a hearing for the House Committee on Financial Services.Speaking virtually at a Tuesday hearing titled “Digital Assets and the Future of Finance: The President’s Working Group on Financial Markets’ Report on Stablecoins,” North Carolina Representative and ranking committee member Patrick McHenry....
“Effective regulatory and supervisory frameworks should be based on the principle of ‘same activity, same risk, same regulation,’” said the FSB proposal. The international monitoring body Financial Stability Board, or FSB, has proposed a comprehensive framework for cryptocurrencies aimed at addressing potential risks while “harnessing potential benefits of the technology.”In an Oct. 11 report, the FSB opened a possible crypto regulatory framework to public comment including proposed policy initiatives, financial stability risks, and the approach the group could use to establish guidelines....
Her Majesty’s Treasury in the U.K. issued a document that details a series of proposals addressing the crypto community. With the consultation, the Treasury is initiating a “regulatory approach to cryptoassets and stablecoins” for 2021 following the Brexit turmoil. Special Focus on Stablecoin Regulation According to the official announcement, the consultation mainly targets stablecoins to gather investments and wholesale uses. The HM Treasury expects to collect insights from the “industry and stakeholders” in the crypto sphere until March 21, 2021. In 2018,....
The need to get regulators and lawmakers to be more actively involved in improving current frameworks and shape the future architecture of blockchain – or Distributed Ledger Technology – is the underlying message of a new report by Innovate Finance, EY & Hogan Lovells on Blockchain adoption and current regulatory environment in the UK. The report, titled Blockchain, DLT and the Capital Markets Journey: Navigating the Legal and Regulatory Landscape identified the key issues that DLT capital market products must navigate in the UK’s legal and regulatory landscape – where applicable, by....