Treasury Secretary Urges Regulators to ‘Act Quickly’ in Drafting Stablecoin Rules

Jeremy Allaire, co-founder & CEO of Circle, the issuer of USDC stablecoin, called this meeting an “extraordinary and positive” movement as “It's a sign of how far we've come and how fast this is all happening.”

Treasury Secretary Janet Yellen met with the top US financial regulators and urged them to accelerate their consideration of new rules to regulate stablecoins.

“The secretary underscored the need to act quickly to ensure there is an appropriate U.S. regulatory framework in place,” the Treasury Department said in a statement following Yellen’s meeting with the President’s Working Group on Financial Markets on Monday.

The group discussed the rapid growth of stablecoins, whose total market cap has surpassed $110 billion, with Tether (USDT) dominating with 57.13% market share followed by USDC at 23.57%, and BUSD at 10.22%.

“The demand for stablecoins comes from the ability to use dollars in new ways,” Robert Leshner, CEO of DeFi lending protocol, Compound Finance, tweeted to the Treasury Secretary.

“Stablecoins are unlocking a wave of innovation with the potential to change every facet of finance; to make markets cheaper, faster, fairer, and more transparent.”

US regulators also discussed their potential uses as well as risks to the financial system.

The group “expects to issue recommendations in the coming months,” according to the statement.

Jeremy Allaire, co-founder & CEO of Circle, called this meeting an “extraordinary and positive” movement as “It's a sign of how far we've come and how fast this is all happening.”

“Crypto, public chains, DeFi, stablecoins and other digital currency models pose many complex questions, and requires significant engagement with policy makers if we hope to achieve global mainstream scale and adoption.”

According to him, stablecoins should achieve mainstream scale far ahead of any CBDC project. And it’s critical that national governments take a view on this, but they shouldn’t “try and fit a square peg in a round hole.”

He said this engagement offers an enormous opportunity for the US government and the global digital currency industry.

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