Janet Yellen Testifies Before House Committee on Financial Services
U.S. Treasury Secretary Janet Yellen recently testified before the House’s Financial Services Committee, discussing various topics such as cybersecurity risks, regulatory coordination, AI in finance, and cryptocurrency regulation. During the hearing, Yellen emphasized the need for tailored regulations for the stablecoin industry and the importance of enforcing existing regulations.
Stablecoins Remain a Major Concern
Yellen focused heavily on stablecoins during the hearing, stating that while they may not pose a systemic risk currently, their widespread use could change that in the future. She called for a regulatory framework to address gaps in authority and ensure consumer protection and financial stability.
Stablecoins Are Not the Enemy
Despite her past criticism of cryptocurrencies like Bitcoin, Yellen did not call for an outright ban or crackdown on crypto. She acknowledged that many cryptocurrencies are not securities and expressed support for a regulatory framework that brings clarity to the industry.
Stablecoin Regulations Might be Coming Soon
Yellen proposed the development of a “regulatory floor” that would provide a basic framework for states and operators. She also suggested granting federal regulators the power to bar certain stablecoin issuers. Yellen emphasized the need for regulatory protections for wallets and other crypto-related products and services. U.S. lawmakers are actively working on reaching a consensus on stablecoin regulations, with legislation potentially emerging in the first half of this year.
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