U.S. Treasury representatives met with representatives of the stablecoin market to discuss the risks and benefits of the fast-growing cryptocurrency sector. There is regulation at play to tame cryptocurrencies into a framework of rules.
The cryptocurrency market is already bigger than two trillion dollars. Of that, about 125 billion represents the market capitalisation of stablecoins. Thus, digital currencies that are tied to some traditional currency, as a rule, the US dollar.
The US Treasury, according to Reuters, held a debate late last week precisely with representatives of various stablecoins about the benefits and risks of a fast-growing part of the financial market. Janet Yellen’s office would like to get cryptocurrencies, first and foremost stablecoins, into the regulatory framework.
Reuters reported that two of the meeting’s attendees said they were asked by ministerial officials whether stablecoins would require direct oversight, akin to oversight of the banking industry. There was also discussion about how the regulator could reduce the risk of too large numbers of people wanting to convert stablecoins into cash, or whether the most prevalent stablecoins should not be backed by some traditional assets.