Is optimism fading? Stablecoin regulatory discussion postponed until fall
While there is no lack of legislative initiatives to regulate stablecoins, the idea of the American CBDC remains problematic.
Analysis
Among a rich array of worries for both the crypto industry and the global economy as a whole, the summer of 2022 will be remembered as the time when stablecoins proved less stable and have therefore caught the attention of regulators.
The TerraUSD (UST) depegging shock in May opened a season of heated stablecoin discussions around the world. Senior finance officials from the Group of Seven largest advanced industrial economies had to send their private jets to the German town of Koenigswinter, with a population of 40,000, to push the international Financial Stability Board body to speed up the regulatory process for cryptography. The Chinese government has signaled its desire for even tighter regulations on cryptocurrencies and stablecoins. Japan has been proactive in limiting the issuance of stablecoins to banks and trust companies.
In the United States, an immediate reaction came from the Congressional Research Service, which called the UST crash a “run-like” scenario and stressed that there is a significant risk that such failures repeat themselves due to existing policy gaps. And although some, like US Treasury Secretary Janet Yellen, refused to follow such an alarming tone, the US crypto community witnessed several major moves to regulate stablecoins in the following months.
> What are the Lummi...
While there is no lack of legislative initiatives to regulate stablecoins, the idea of the American CBDC remains problematic.
Analysis
Among a rich array of worries for both the crypto industry and the global economy as a whole, the summer of 2022 will be remembered as the time when stablecoins proved less stable and have therefore caught the attention of regulators.
The TerraUSD (UST) depegging shock in May opened a season of heated stablecoin discussions around the world. Senior finance officials from the Group of Seven largest advanced industrial economies had to send their private jets to the German town of Koenigswinter, with a population of 40,000, to push the international Financial Stability Board body to speed up the regulatory process for cryptography. The Chinese government has signaled its desire for even tighter regulations on cryptocurrencies and stablecoins. Japan has been proactive in limiting the issuance of stablecoins to banks and trust companies.
In the United States, an immediate reaction came from the Congressional Research Service, which called the UST crash a “run-like” scenario and stressed that there is a significant risk that such failures repeat themselves due to existing policy gaps. And although some, like US Treasury Secretary Janet Yellen, refused to follow such an alarming tone, the US crypto community witnessed several major moves to regulate stablecoins in the following months.
> What are the Lummi...What's Your Reaction?
