© Reuters. File picture: U.S. Treasury Secretary Janet Yellen testified before the Senate Financial Services Appropriations Subcommittee on June 23, 2021, on Capitol Hill in Washington, DC, on the fiscal year 22 budget application. Shawn Thew/Pool via REUTERS/
WASHINGTON (Reuters)-Treasury Secretary Janet Yellen told regulators on Monday that the US government must act quickly to establish a regulatory framework for stablecoins, which are a rapidly growing digital currency.
The U.S. Treasury Department said in a statement that a group of U.S. regulators plan to make recommendations in the coming months to resolve any regulatory loopholes surrounding stablecoins.
The Presidential Financial Markets Working Group meeting on Monday highlighted how quickly policymakers are taking action to ensure that their rules can keep up with the rapid technological changes in digital currencies.
According to the Ministry of Finance, the group discussed the rapid growth of stablecoins, which are cryptocurrencies that try to peg their value to traditional currencies such as the U.S. dollar. Regulators discussed their potential uses and the risks to end users and the financial system.
Federal Reserve Chairman Jerome Powell told lawmakers at a congressional hearing last week that stablecoins are “growing very fast,” but pointed out that their lack of proper supervision is a worrying issue.
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