![]() ![]() “We think this is going to be a growing area,” she said. For Figure, partnering with banks was a faster option than getting a bank charter of its own. She said that of the various financial services businesses available to consumers, banks are well trusted, offer the most consumer protections and are the most regulated. “When the President’s Working Group report came out, it was entirely consistent with what we’re building,” Harris said. to launch a stablecoin, announced in February it would sell its intellectual property to Silvergate Capital Corp., the parent company of Silvergate Bank.įigure began working on the consortium about a month before the Working Group report was released, said Ashley Harris, general counsel at the company. The Diem Association, which had backing from Facebook parent Meta Platforms Inc. She said the transition of these companies into banking requires internal discussion on business strategy and how the companies want to be seen in the market, such as their level of customer safety.īoston-based Circle Internet Financial LLC, a blockchain-focused financial services company and stablecoin issuer, announced in August it was preparing an application to become a federally chartered, full-reserve national commercial bank.Ĭircle and companies like it are looking to differentiate themselves, Warren said. “Eventually there are likely to be some new rules that come down about this stuff that are either symmetrical to banking rules or are analogous.” “I think it’s probably safe to say that everyone who is or wants to be a stablecoin issuer is thinking about this,” Sheila Warren, CEO of the Crypto Council for Innovation industry group, said in an interview. ![]() But rarely are they directly tied to the heavily regulated banking industry.Īccording to observers, the move by issuers toward banking is partially driven by the market itself. They’ve been around for several years and may come with various assurances that they are backed by currency. “Stablecoins are currently not regulated in any meaningful way,” Timothy Massad, a former chair of the Commodity Futures Trading Commission, said in a post on the Brookings Institution’s website last year. Stablecoins make up only about 5 percent of the value of the cryptocurrency ecosystem but are used to facilitate three-quarters of trades on digital asset trading platforms, according to a December memo from the House Financial Services Committee. dollar, unlike other, highly volatile cryptocurrencies. Stablecoins typically are tied to the value of a national currency, such as the U.S. The Working Group warned that “runs” on the digital assets could spread contagiously to others, posing a risk to the broader financial system.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |