If stablecoins such as banks are regulated, you should enjoy all the advantages-op-e-eD

The US Ministry of Finance suggested that StableCoin emitters as bank institutions be a good idea if StableCoin emitters are offered by the same privileges.

Report of the US Ministry of Finance: StableCoin regulation urgently required

The rise of stablecoins within the crypto ecosystem serves as a blatant memory that cryptocurrencies and blockchain technology have outgrown their modest beginnings and are gradually positioning themselves as challengers of the existing hegemony of inpatient finance.

with the market capitalization of stable coins grows with examples Speed ​​, governments and financial supervisory authorities have started to focus on better regulation of this aspiring asset class. Stablecoins are naturally backed up by "stable" assets that enable them to keep a constant value in relation to the underlying asset. Due to this function, stable coins are increasingly used to make lending, borrowing and trading with other digital assets easier.

The StableCoin market is currently estimated at more than $ 135 billion, with considerable chances of explosive growth because it begins to attract the attention of companies and private individuals as an accepted means of payment. Due to their embedded properties such as low costs, scalability and almost immediate processing, stable coins could ultimately displace bank transfers. For this reason, governments and financial supervisory authorities are trying to regulate this growing asset class.

The idea of ​​regulating StableCoin companies as banks

At this point, almost every country either experimented or has implemented regulatory guidelines on cryptocurrencies. But the US government is one of the first to show great interest in stable coins.

From the chairman of the Federal Reserve, Jerome Powell, who urges the need to regulate stable coins-especially those that are $ 1: 1 to the US dollar-until the chairman of the Securities and Exchange Commission (SEC), Gary Gensler, who emphasizes the advantages of regulation for both service providers and for consumers The attraction for political decision -makers.

Another risk that alerted the supervisory authorities is the clarity of the wealth value that supports the stable coin. While the coins may seem coupled to the US dollar, significant parts of the most popular stable coins such as , , USDC and Busd are actually secured by commercial paper and US state bonds that act as "cash-like" securities.

The the latest report of the US Finance Ministry says that regulation in relation to stable coins is urgently necessary for the risks Represent the integrity of the financial markets, including compliance with the laws to combat money laundering (AML) and terrorism financing (CFT). The report also points out that stablecoin companies such as banks should be regulated because stable coins in the traditional economy play the same role as bank-regulated Fiat currencies.

Need for a level playing field

Although the Finance Ministry's report emphasizes the financial risks of stable coins, it overlooks something fundamental. On the one hand, she recommends treating stable coins as Fiat currencies and regulating accordingly, but does not take into account the perspectives of the companies behind these stablecoins.

It cannot be denied that the regulation of stablecoins could be a game change for Defi and Tradfi. In order to achieve this, however, governments and supervisory authorities must also ensure that stable coins receive the same privileges as Fiat currencies and that companies also receive similar treatment as regulated banks.

simply expressed if the US Ministry of Finance wants to regulate stable coins as banks, it should also enable stablecoin companies to maintain a model of the fractionated reserves. At the moment, stable coins are covered by a ratio of almost 1: 1 with USD and cash -like equivalents. In comparison, deposit banks in the United States usually only have to keep a certain proportion (usually around 10 %) of all aggregated deposits in cash.

Due to the partial reserves system of the bank system, all regulated banks in the United States only keep a fraction of their deposit liabilities in liquid funds as a reserve and can borrow the rest of the borrower if necessary. This enables you to reinvest the money into high -interest investments instead of keeping the entire deposits in cash or payment of payment.

StableCoin platforms must keep all of their deposits in cash or means of payment inequality such as government bonds or commercial paper, and the money pooled on these platforms is broke and does not serve any other purpose. For example, take the recent unveiling of paxos via assets such as pax and bus support , according to which 96% of the reserves in liquids and 4% are created in US treasure changes.

the long and stable way

It is difficult to say how things will develop for stable coin emitters in the long run, but to regulate them as banks without the same privileges, in view of the potential advantages that can result from this technological revolution, is almost too hasty and short-sighted. Nevertheless, a comprehensive examination and compliance frame is required to ensure transparency and the collateral that is required for greater acceptance.

Do you believe that stable coins should be regulated as banks? Let us know in the comment area below.

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