Fed Waller Says Stablecoins Don’t Need Full Bank Settlement


The Federal Reserve Building on Constitution Avenue is pictured in Washington, USA on March 19, 2019. REUTERS / Leah Millis

Nov. 17 (Reuters) – A stricter regulatory and supervisory framework is needed to ensure that stablecoins are a safe form of payment, but they should not necessarily be subject to the same rules as banks, the governor of the Federal Reserve, Christopher Waller. .

“The regulatory and supervisory framework for stable payment coins should take into account the specific risks these agreements pose – directly, fully and closely,” Waller said at a virtual conference hosted by the Cleveland Fed. “But that doesn’t necessarily mean imposing full bank settlement, which is partly focused on lending, not payments.”

Stablecoins, a form of virtual currency whose values ​​are tied to more traditional assets such as the US dollar or commodities, are part of a rapidly growing market. Some analysts say they expect stablecoins to have greater potential than other cryptocurrencies such as bitcoin to be used as a mainstream payment method.

The policymaker said he disagreed with some of the recommendations made earlier this month in a report by the President’s Financial Markets Task Force, which called on Congress to regulate coin issuers. stable like banks.

Waller also said that while he would agree with the idea that banks could issue both bank deposits and stablecoins, he did not agree with the idea that only banks should be able to issue. issue stable coins.

The Fed official added that he was still skeptical of the need for a central bank digital currency, or CBDC, because there is already “real and rapid innovation” in the payments space.

The US central bank is considering whether it should issue a digital version of the dollar and is expected to publish research on the subject soon. But Waller said he didn’t think the government should create a CBDC in the idea of ​​trying to cut payment costs.

Report by Jonnelle Marte; Editing by Andrea Ricci

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