Stablecoin issuers such as Tether or Circle may soon have to deal with bank-like regulations, a report from the Wall Street Journal mentions.
A senior administration official has confirmed that the reporting is true and that the federal government has thought of two options.
One of them is the congressional pathway that was highlighted by the Wall Street Journal while the other one is relying on the Financial Stability Oversight Council (FSOC) which is made out of several regulators that have the role of monitoring potential risks to the financial system.
Senator Cynthia Lummis held a speech Wednesday in which she asked for regular audits of stablecoin issuers and made it clear that it is worrisome that there isn’t transparency coming from the reserve backings of important issuers.
Dante Disparte, the CSO of Circle, declared:
“Today’s news reports about the potential recommendations from the President’s Working Group on Financial Markets (PWG) is encouraging, as the time has come to address the risks and seize the significant opportunities of dollar digital currencies like USD Coin (USDC). Circle has already been working toward becoming a full-reserve national commercial bank, and we strongly believe that a full-reserve banking model built on digital currency technology can lead to a more efficient, fair, inclusive, and resilient financial system.”
Source: CoinDesk.com