Although Yellen assured that what was seen with these stablecoins does not compromise the local economy, the official did not rule out that they could eventually represent a risk, for which she highlighted the need for federal legislation that addresses these and other assets.
the secretary of the US Treasury, Janet Yellen indicated that the fall seen in the stablecoin market, referring specifically to what happened with UST from land and to the slight drop seen in the price of Tether, does not represent a threat to the financial stability of the North American nation.
Yellen pronounces on stablecoins
Yellen’s statements came to the fore during a hearing before the House Financial Services Committee held today. There, the Treasury official stressed that the market for UST it did not have a size in which its fall could notably affect the finances of the nation, something that would not be happening with the reduction seen in the price of USDT, this based on the conclusions presented in a report published in November by the Presidency Working Group on Financial Markets.
However, although she is not concerned about what she has seen, Yellen did not rule out that the cryptocurrency market and its accelerated growth could compromise the financial stability of the United States, for which she commented:
“[Los activos digitales] they are growing very quickly. They present the same type of risk that we have known about for centuries in relation to bank runs.”
And I add:
“We just had this last week with Terra and with Tether an illustration of the risks associated with stablecoins… there can be runs… We came up with a good regulatory framework to deal with this, and it is a federally insured depository institution.”
The need for a CBDC
The official took advantage of the space to refer again to the need for a digital dollar backed by the Federal Reserve (FED)digital currency that could be defined as a cbdc, which could have a positive impact for financial intermediation.
In this regard, Yellen commented that its usefulness and benefits would be greater than the risks it would entail, taking into account that its operation would be similar to that of known stablecoins but with other guarantees.
While acknowledging the benefits, Yellen again called on legislators to design a consistent federal framework to address these and other digital assets, precisely because of the remarkable volumes of business operations and the interest expressed by many US investors.
Angel Di Matteo version / DailyBitcoin
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