The US Treasury of Department is planning to issue a report that revolves around stablecoins and the risks that they pose to the financial systems.
The Bloomberg report notes that after the Treasury officials have created the report, it will be presented to the President’s Working Group that deals in the Financial Markets Division. However, details regarding when the involved parties will meet to discuss the issue are scarce.
Initiative Involves Top Treasury Officials
Top officials representing various sectors of the US financial markets have been involved in the preparation for this report. These officials involve the Treasury Secretary, Janet Yellen, the Chair of the US Securities and Exchange Commission (SEC), Gary Gensler, the Federal Reserve Chairman, Jerome Powell and other relevant regulators. The meeting between these officials happened on July 19.
The Treasury officials have been working on the use cases of stablecoins. Citing unnamed sources, Bloomberg notes that stablecoins have been a top issue that is being discussed by the US Treasury.
Various executives from the Treasury have met with several representatives from financial sectors, to discuss how stablecoins can be regulated. The meeting also involved discussing other issues related to the cryptocurrency sector.
There has been no official communication from the Treasury about the issue. In addition, hints about what kind of regulations or restrictions will be imposed have not been given.
Regulatory Crackdown on Crypto Sector
The US federal government has been keen about the fast-growing cryptocurrency sector. Various financial institutions have been proposing changes in recent months. The chair of the SEC, Gary Gensler, recently spoke about the lack of regulatory clarity in the sector.
One of the gaps that Gensler pointed towards is the lack of one federal regulator that will oversee the crypto spot trading sector and provide protection to investors. The lack of a clear regulatory framework in the market has caused a turf between the SEC and the Commodity Futures Trading Commission (CFTC), over which of the two bodies has authority over crypto.
The Treasury Department has also been aggressively involved in introducing taxes into cryptocurrency transactions. Last month, a highly contentious $1 trillion infrastructure bill was passed, which broadened the scope of the definition of a ‘crypto broker.’
The tax proposal targeted institutions and individuals such as validators, who do not deal directly in crypto transactions. This broad definition has caused criticism for the bill, as it made it hard for some people to comply. The infrastructure bill was passed by Congress and is now awaiting voting by the House of Representatives on September 27.
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