Regulations for Stablecoins Should be More Liberal – Hester Peirce
U.S. Securities and Exchange Commission (SEC) official Hester Peirce said future regulation of stablecoins should leave room for "failure" in light of the collapse of Terra (LUNA) this week.
Speaking at the Digital Monetary Institute’s annual symposium on Thursday, the official predicted that regulation of stablecoins could be arriving soon.
“I think we may see some movement in stablecoins. It’s an area that got a lot of attention this week, but I think overall it’s an area in crypto that had a moment and there’s a lot of use of stablecoins and so people think in the future, as this gets even bigger, we want to have some sort of regulatory framework. Some are suggesting that it should be with the SEC. Others want it to sit with banking regulators, so there are different ways to approach stablecoins.”
Peirce, a well-known cryptocurrency supporter, said that one term can encompass many different types of assets and explained that there can be big differences between stablecoins.
She pointed out that regulating is difficult because it must cover the various stablecoin offerings that exist today, as well as any potential technologies that may exist in the future.
“What I’ve been suggesting to the SEC is to use the regulatory tools that we have that allow us to grant exemptions from our existing regulations that are tailored to a particular technology, and that’s how we could do this – allow iteration and experimentation, which I think is really important at the beginning of any technology.
And in terms of experimentation, I have to say that we have to leave room for failure, because of course that’s part of trying new things. And our framework allows for exactly that kind of trial and error, and I hope we’ll use it to that end.”
Peirce said in an interview with CQ Roll Call that it makes sense for a lot of stablecoins to be regulated through a bank “lens”.
“There might be specific facts and circumstances that would suggest that something is within our jurisdiction,” Peirce said.
“But generally speaking, I don’t have an issue with bank regulators taking stablecoins into their jurisdiction.”
The SEC official said she wants a framework for this asset class that makes sense and allows them to be used.
“I think private stablecoins are a good alternative to a central bank digital currency, so whatever regulatory framework is put around them … should recognize that they play a valuable role,” Peirce said.
“They now play a valuable role in the crypto world in decentralized finance, but they could play an even more valuable role more broadly in a lot of different ways.”
Andrey Kunev
Reporter at CoinsPress
Andrey Kunev is a knowledgeable cryptocurrency content creator passionate about the crypto market. With extensive experience in market analysis and investment reporting, Andrey is a valuable asset to the CoinsPress team. As a frequent contributor, he offers insightful and comprehensive coverage of market trends, price fluctuations, and new advancements in cryptocurrency. Whether you're a seasoned investor or just getting started, Andrey's clear and concise writing offers a comprehensive look at the current state of the crypto market and its prospects. Stay up-to-date with CoinsPress's expert analysis and commentary on all things cryptocurrency.
