As revealed recently, the Secretary of the US Treasury, Janet Yellen, will be meeting the Working Group of the President on Financial Markets next week in order to discuss the role of Stablecoins in the financial system. The Treasury made an announcement on Friday regarding the meeting that will be taking place on Monday and will include the representatives from the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation.
Janet Yellen, US Treasury Secretary to Discuss Stablecoins With The President’s Working Group
Talking about Stablecoins, they are the digital currencies designed in such a way that they are less fluctuating than the cryptocurrencies by pegging their market value to an outside asset like the US dollar.
In a statement released on Friday, Yellen said:
“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. 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.”
In addition to this, it should be noted that the regulators have become increasingly concerned regarding the transparency in the changing hands of stablecoins.
The Reliance of Market Participants and Emergence of Defi
Both the Stablecoins and Defis are growing in interest and moreover earlier this year, VISA released a statement saying that it is starting to support payments on its network in the USDC.
Well, the fact that the industry requires regulation now more than ever as more and more firms are going public or preparing to do like Coinbase and Circle.
Also, it should be noted that Jerome Powell the Chairman of the Federal Reserve acknowledged that the Stablecoins would require an appropriate framework for their operations before the Senate Banking Committee.