In the past months, it has been announced that an advisory report will be published on the regulation of stablecoins after the work carried out by the President’s Working Group (PWG) and the US Treasury.
Pat Toomey, a senior Republican on the Senate Banking Committee, wrote a letter to US Treasury Secretary Jannet Yellen expressing her concerns.
In his letter, the senior senator stated that he was not satisfied with the expected work of the Treasury on stablecoins and that the fate of cryptocurrencies like Tether should be decided by Congress rather than by US financial regulators.
The Senator also stated that it would be “very unfortunate” for the rules for stablecoins to be determined by PWG.
In his letter, Toomey said that PWG and the Treasury did their work behind closed doors and did not do enough research while conducting the work.
Since PWG announced its stablecoin review, management has revealed little about the process it used to prepare this report. As I understand it, stakeholders only had a minor involvement in the process and only a few stablecoin providers were invited to participate.
Each of the invited participants was given only five minutes to make a presentation.
In his letter, the senator emphasized that Congress should pass new explanatory laws, stating that financial regulators should be blocked, otherwise it would be to allow regulators to declare stablecoins as a potential danger.
Stating that this will cause great harm to the developing technology, Pat Toomey stated that stablecoins do not pose a threat to the stability of the US financial system.
It was recently announced that Biden is working on a bank-like regulation plan for stablecoins. It was written that the first way for this regulation is through Congress and the second way is through the Financial Stability Oversight Council (FSOC).