Author Amy Liu
The White House today issued a statement on stablecoin regulatory considerations, including potential restrictions on “multi-currency stablecoins.”
This statement comes from the President’s Financial Markets Working Group, which is centered on the Treasury Department and makes recommendations to the President and federal regulators.
The working group emphasized the importance of anti-money laundering and combating financial terrorism measures, including on-chain KYC verification between parties.
According to a previous report by “Bi Tweet”, the Financial Crime Law Enforcement Network announced a proposed rule that will impose higher KYC requirements on transactions between money service companies and non-custodial wallets.
Since algorithmic stablecoins (such as Empty Set Dollar) and cryptocurrency-backed stablecoins (such as Dai) are not backed by fiat currencies, it is not clear how the working group’s recommendations will affect these stablecoins.
The statement of the working group also stated that stablecoins may pose a threat to “international currency stability” and recommended actions to be taken so that “stable currency arrangements should not weaken the confidence and ability of domestic legal tender.”
In a statement, Deputy Finance Minister Justin Muzinich said that regulators will continue to pay close attention to the stablecoin arrangement and look forward to dialogue on these issues in the future.
Digital payments, including payment systems secured in U.S. dollars and other stablecoins, have the potential to increase efficiency, increase competitiveness, reduce costs, and promote wider financial inclusion.
While encouraging payment innovation, digital payment systems including stablecoins should be designed and operated in a responsible manner to effectively monitor risks and maintain the stability of the US internal and international financial and currency systems.
