U.S. Treasury Secretary Janet L. Yellen has convened top financial markets advisors and regulators to discuss the potential — both good and bad — of stablecoins, her office announced.
The meeting of the President’s Working Group on Financial Markets, which includes representatives of the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation, is scheduled for July 19.
Stablecoins are cryptocurrencies tied to real-world assets whose prices tend not to fluctuate widely, especially the currencies of the countries with the world’s largest economies.
“Bringing together regulators will enable us to assess the potential benefits of stablecoins while mitigating risks they could pose to users, markets, or the financial system,” Yellen said in a prepared statement. “In light of the rapid growth in digital assets, it is important for the agencies to collaborate on the regulation of this sector and the development of any recommendations for new authorities.”
An official announcement of the meeting states that the group “will examine the current regulation of stablecoins, identify risks, and develop recommendations for addressing those risks.”
The group is likely to make formal recommendations around stablecoins “in the coming months,” the announcement adds.
The working group consists of the treasury secretary, chair of the board of governors of the Federal Reserve System, chair of the Securities and Exchange Commission and acting chair of the Commodity Futures Trading Commission.
Regulators have taken increased interest in stablecoins of late, focusing especially on transparency when there is doubt about the real-world assets to which the coins’ values are pegged.
One option for stablecoins — blockchain currencies created by governments — also has drawn attention in Washington D.C. Lawmakers sparred a month ago over whether the government should create a cryptocurrency to promote stability or whether the private sector should operate cryptocurrencies to enhance innovation and privacy.