Fed Chairman Jerome Powell: Stablecoins need to be overseen by central banks


US Stablecoin Regulation

U.S. Federal Reserve Board (FRB) Chairman Jerome Powell said at a public hearing on the 21st that the issuance and use of crypto assets (virtual currencies) stablecoins require strong supervision by central banks. rice field.

The Fed explained that it considers stablecoins used for payments to be “one of the currencies.” And he says the ultimate source of trust in a currency is the central bank. Powell said weakening the role of central banks and creating too many private currencies at the state level would be a mistake.

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In the United States, there is currently no national-level cryptocurrency regulation, and regulations are currently being developed. As for stablecoins, the latest version of the bipartisan stablecoin draft was released this month. While the latest version lists central banks as the primary regulators in setting stablecoin issuance requirements, it remains unchanged from previous drafts to allow state regulators to oversee companies that issue tokens. rice field.

connection: US bipartisan stablecoin draft, latest version released

From now on, it is expected that the balance of authority between central banks and state authorities will also be discussed in the stablecoin regulations in the United States.

What is a stablecoin

A cryptocurrency whose price is always stable. Various stablecoins have been developed whose value is backed by legal currency or virtual currency, or whose price is stabilized by algorithms.

▶Cryptocurrency Glossary

connection: What is a stablecoin that even beginners can understand | Explain features and use cases

About virtual currency

During the hearing, Powell also spoke about cryptocurrencies. When asked by a lawmaker, “Do you think cryptocurrencies have an impact on the U.S. economy as an asset?”

He also said that members of the U.S. central bank have held discussions with lawmakers from both parties about legislation regulating cryptocurrencies.

Powell also said it would take time to decide whether to actually issue a central bank digital currency (CBDC), a so-called digital dollar.

connection: What is Central Bank Digital Currency (CBDC) | Differences from Bitcoin and Main Advantages

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