Odaily News Federal Reserve Governor Waller said stablecoins have the potential to “maintain and expand” the dollar’s international role, although their rise and fall will depend on credible business use cases and a coordinated set of rules.
“The stablecoin market would benefit from a U.S. regulatory and supervisory framework that directly, comprehensively, and rigorously addresses stablecoin risks, should allow non-banks and banks to issue regulated stablecoins, and should consider the impact of regulation on the payments landscape,” Waller said in prepared remarks for the San Francisco conference.
It added: “The emergence of different global stablecoin regulatory regimes could create domestic and international regulatory conflicts, and such regulatory fragmentation could make it difficult for U.S. dollar stablecoin issuers to conduct business globally.”
Waller noted that state regulators have been “key players” in the development of the stablecoin market, with some states in the process of enacting laws or finalizing new regulations. “State regulations may conflict, which could prevent all states from using the same stablecoin and reduce the scalability of stablecoins.”
Waller also pointed out that stablecoins are at risk of a run.
Recently, bipartisan senators proposed a bill to provide a regulatory framework for stablecoins, including requirements to maintain one-to-one reserves and comply with anti-money laundering laws. The House Financial Services Committee has released a draft of the bill. (Bloomberg)