On Nov. 1, the US Treasury tweeted about having issued a report on stablecoins together with the US President's Working Group on Financial Markets, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency.
Related: SEC head compares stablecoins to securities
Today, Treasury joined colleagues from the President’s Working Group (PWG) on Financial Markets, @FDICgov and @USOCC to issue a report on stablecoins.
— Treasury Department (@USTreasury) November 1, 2021
Read more: https://t.co/7blQTYYJAU
In the beginning, the regulators mentioned the benefits of stablecoins and how they are used in the USA to make operations with other digital assets more efficient. It was also mentioned that there’s a ground for the field to grow. Going further, the paper mentions risks related to the sector.
The regulatories find that stablecoins can serve as a tool to make the trading of speculative assets across different platforms or via DeFi arrangements easier. As a result, they can have a bad impact on market integrity and be exploited by scammers.
As mentioned in the release, there is a need for investor protection. Stablecoin is a much-discussed subject by the US government. The paper urges Congress to regulate issuers of stablecoins as it regulates the banking system, also saying fin. authorities need to check if the growing sector presents systematic risks.
The regulators inform that the market cap of the assets issued by the largest coins stands above $127 billion per data of Oct. 2021. In terms of a year, the amount raised by over 500%. Presently, most stablecoins are pegged to the USD.