Congress must act on stablecoins, according to a leader at the Federal Reserve.
"I believe Congress should work expeditiously to pass much-needed legislation to bring stablecoins, particularly those designed to serve as a means of payment, inside the prudential regulatory perimeter," said Michael Barr, the Fed's vice chair for supervision a speech at The Brookings Institute, a think tank. "I look forward to continued partnership with other regulatory agencies and Congress to address the risks of stablecoins."
Barr is focused on oversight of financial stability as part of his role, though he is hardly unique among regulators in his view that "Stablecoins, like other unregulated private money, could pose financial stability risks."
"Crypto-asset related activity, both outside and inside supervised banks, requires oversight so that people are fully aware of the risks they face," he said.
Stablecoins have become a focal point of crypto-focused legislation in Congress in the past year. The House Financial Services Committee's leadership made a late-July push to get a bill on stablecoins out before August recess. On the Senate side, Pat Toomey, the leading Republican on the Banking Committee, has been circulating prospective legislation. He is, however, leaving the Senate for good at the end of the year.
Barr's colleague Fed Vice Chair Lael Brainard also spoke today in New York on the Fed issuing a digital dollar.
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