The US Treasury Department has reportedly instructed in a report to the US Securities and Exchange Commission (SEC) that it will have enough legal power over stablecoins like Tether (USDT). According to Bloomberg, quoting sources familiar with the matter, the regulator could be greenlighted to establish a series of guidelines on how to police these tokens.
This step taken by the US authorities could be part of the efforts to establish a clearer framework to regulate the cryptocurrency industry in the country. In fact, Bloomberg notes that such revisions to the forthcoming report seek to start regulating stablecoins to pave the way for long-term policing plans in cryptos.
“For industry executives, Gensler’s successful lobbying is likely to come as bad news because they already argue his agency has been overreaching,” the article stated. Moreover, as mentioned by the US Treasury Department, the’ highly-anticipated’ report intends to reaffirm the US Commodity Futures Trading Commission’s (CFTC) stance in supervising stablecoins. “The report will also urge Congress to pass legislation specifying coins should be regulated similarly to bank deposits, one of the people said, asking not to be named because discussions are private,” Bloomberg added.
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Gensler on Stablecoins
In a recent interview by Yahoo Finance, Gary Gensler, the US SEC Chairman, commented the following on stablecoins: “There’s about $130 billion in stablecoins today. That’s up nearly 10-fold in the last year. They’re only 5% of the crypto market but 80% of the volume in this token-to-token, crypto-to-crypto trade. There’s a lot of speculative activity.”
Furthermore, early this month, Gensler pointed out that the US will not follow China’s lead in banning cryptocurrencies completely. He added that any decision regarding a crypto ban would be up to Congress. “We are really working with the authority they (Congress) have given us. I have said this before; I think many of these tokens do meet the test of being investment contracts or a note or some other form of a security,” the SEC Chair commented.