The U.S. Treasury Department considers stablecoins a serious problem and is preparing regulations, according to a Bloomberg report.
The U.S. government appears ready to impose restrictions on the cryptocurrency market as reports indicate that it will consider stablecoins a threat. Bloomberg reported on September 16 that U.S. Treasury officials have flagged tether
and other stablecoins as a serious problem.
Stablecoins are a concern
The U.S. sees stablecoins as
Several other countries and global financial players also share this view. US and EU regulators have mentioned it extensively, while the Bank for International Settlements (BIS) has said that international cooperation is needed when it comes to CBDCs. Governments see CBDC as a countermeasure to stablecoin
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Further, the report noted that “widespread, fiery sell-offs” of cryptocurrency assets could threaten financial stability. The Financial Stability Board will be looking into the potential risks associated with stablecoins
, so nothing is guaranteed.
, which has caused concern for many governments since its announcement. The social network is likely to launch its stablecoin by the end of the year. US authorities are particularly focused on clearing and processing stablecoin transactions.
Overall, the move is expected. This step will not necessarily be fatal for the market, as many investors have been calling for the US government to be clear on regulation. This is for the good of the market, which has quickly gained legitimacy over the past 12 months.
Regulatory Framework Limitations
Bloomberg report also notes that authorities are preparing to issue a general regulatory framework in the coming weeks. This has been a long time coming, with many officials becoming increasingly vocal about the cryptocurrency market.
It is unlikely that the United States will impose draconian measures on the market. It is more likely to restrict very specific assets and use cases. In addition to stablecoin, officials have also highlighted lending platforms and the possible securities nature of some assets.
Ripple could lose out from this development, as its <a href=”https://beincrypto.pl/learn/rodzaje-kryptowalut-i-tokenow/” target=”_b
lank” rel=”noopener”>the XRP token is used to facilitate cross-border transactions. The company is holding firm to its position, despite being embroiled in a lawsuit with the SEC. The fact that the US seems eager to prevent these transactions in any dollar-based, government-backed asset could be a problem.
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