USDC issuer Circle supports proposal to regulate stablecoin issuers as banks

USDC issuer Circle supports proposal to regulate stablecoin issuers as banks

Tether (USDT), and USD Coin (USDC), are likely to be required to operate under the same regulations that banks. However, this doesn’t seem like a concern for the Circle CEO.

Circle CEO Jeremy Allaire supported the Biden administration’s proposal to create a bank-like regulatory system for stablecoin issuesrs. He noted that the proposal to regulate dollar stablecoin issuesrs in the United States as banks at the Federal Reserve level is a significant step forward for the industry’s development.

Allaire stated that the current steps would improve the money transmission-focused regulations to “a fundamental infrastructure at the heart of what potential the future of capital markets and banking look like.”

Allaire stated, “There is a recognition that these payment stablecoins will grow rapidly at an internet scale.” He said that when the stablecoin market reaches the hundreds of trillions in transactions and billions in circulation, financial stability and the risk to financial markets will be more serious.

Related: Acting CoC-Hsu: More regulation of cryptography is necessary

Cointelegraph reported that the proposal by the Biden administration aims to create a “special-purpose charter,” which would allow stablecoin issuers to be included in the same group as banks. Allaire thinks that details of a bank charter for crypto companies will need to be worked out with the FDIC and other oversight agencies.

Stablecoins are a hot topic for regulators. According to reports, the U.S. Treasury held several meetings in September to discuss the risks associated with stablecoins for markets, users, and the financial system.

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