US regulators are investigating a guideline for banks to deal with cryptocurrencies, says FDIC president

Jelena McWilliams, President of the Board of Directors of the Federal Deposit Insurance Corporation or FDIC for its acronym in English, said that The agency is working with other US regulators to investigate “under what circumstances banks can engage in activities related to crypto assets”.

Speaking at the Money20/20 financial technology conference on October 25, McWilliams said that The FDIC, in coordination with the Federal Reserve and the Office of the Comptroller of the Currency, is trying to create regulatory clarity for banks that handle crypto assets, including stablecoins. The president said the FDIC plans to issue “a series of political statements” on guidelines for banks in the coming months.

According to McWilliams, stablecoins have many potential benefits for consumers, such as faster, cheaper, and more efficient payments. However, he stated that if “One or more currencies became the predominant currency in the United States or worldwide” could have a significant impact on the financial stability of that country, the cause of running out of funds with insured banks.

US regulators are investigating a guideline for banks to deal with cryptocurrencies, says FDIC president
US regulators are investigating a guideline for banks to deal with cryptocurrencies, says FDIC president

“To reap the potential benefits of stablecoins, they must be subject to well-tailored government oversight, taking into account the potential risks,” said the FDIC president. “This supervision should be based on the fact that stablecoins issued from outside the banking sector are actually backed 1 to 1 by highly liquid and secure assets.”

McWilliams’ testimony came on the same day that Bloomberg reported that many U.S. regulators had agreed that the Securities and Exchange Commission would lead the country’s efforts to regulate stablecoins. The Treasury Department announced in July that it was looking into creating some sort of bank letter for stablecoin issuers.

The apparent lack of regulatory clarity regarding digital assets in the United States is a problem for many companies fearful of legal action or other forms of government action. Some lawmakers have proposed laws to U.S. regulators to work with participants in the cryptocurrency space to better define what is expected of them.

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