Treasury Secretary Janet Yellen has planned a meeting with regulators to discuss interagency work on stablecoins.
The meeting will be held on Monday with the President’s Working Group on Financial Markets, the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation, according to a Friday news release.
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“Bringing together regulators will enable us to assess the potential benefits of stablecoins while mitigating risks they could pose to users, markets, or the financial system,” Yellen said. “In light of the rapid growth in digital assets, it is important for the agencies to collaborate on the regulation of this sector and the development of any recommendations for new authorities.”
Stablecoins are a type of cryptocurrency that have grabbed headlines in recent months. Stablecoins such as Tether and USD Coin have their value tied to another asset class such as gold or fiat currency and don’t fluctuate in value as unpredictably as other cryptocurrencies because they are asset-backed.
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The President’s Working Group will examine existing regulation of stablecoins and the risks associated with them and will offer recommendations about how to mitigate those risks, with written recommendations expected in the coming months, according to the Treasury Department.
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Federal Reserve Chairman Jerome Powell was asked about stablecoins during two hearings he attended on Capitol Hill this week. He told lawmakers that it is “very important” to regulate them. On the topic of a central bank digital currency akin to a stablecoin, Powell said that he is still “legitimately undecided” on whether the benefits outweigh the risks.
