US regulators will begin work on stablecoin regulations under the leadership of the Securities and Exchange Commission (SEC).
According to a Bloomberg report on October 26, 2021, anonymous sources claim that the SEC has taken over the powers to propose legislation and oversee stablecoins. Sources also state that the SEC’s authority over the industry will be officially announced by the Treasury Department this week.
This will also determine the jurisdiction of the Commodity Futures Trading Commission (CFTC) and the Treasury Department regarding stablecoins. This study of the Treasury Department was announced at the President’s Working Group on Financial Markets (PWG) meeting in July. With this situation, it was stated that a new type of banking contract will be created with regulatory measures.
The PWG is comprised of representatives from top US regulatory agencies, including Secretary of the Treasury Janet Yellen, SEC Chairman Gary Gensler, Federal Reserve Chairman Jerome Powell, and CFTC acting chairman Rostin Behnam. According to Bloomberg, Gensler is working as a regulator to have more authority over stablecoins and frameworks for overseeing bank deposits are also planned to be introduced for the stablecoin sector.
According to the SEC Chairman, Stablecoins Look Like Poker Chips!
Last month, Gensler called on Congress to assist with stablecoin regulation. Besides that, Gensler likened stablecoins to “poker chips in the casino.”
As you know, the stablecoin market faced serious growth in 2021. The market capitalization of leading stablecoin company Tether has risen significantly this year, increasing by 229% since the start of the year.