U.S. President Joe Biden responds to a question from a reporter after speaking about coronavirus disease (COVID-19) vaccines and booster shots in the State Dining Room at the White House in Washington, U.S., (Photo : REUTERS/Evelyn Hockstein)
The Biden administration is looking into ways to impose bank-like regulation on companies that issue stablecoins, including asking them to register as banks, the Wall Street Journal reported on Friday https://www.wsj.com/articles/biden-administration-seeks-to-regulate-stablecoin-issuers-as-banks-11633103156?mod=latest_headlines, citing people familiar with the matter.
The administration is also expected to urge the Congress to consider a new legislation to create a special-purpose charter, the report said, which would be tailored to the business models of such firms.
Stablecoins are a kind of digital coin that are pegged to traditional currencies.
Regulators across the globe have taken steps to clamp down on cryptocurrencies amid worries that the rapidly expanding market for privately operated currencies could lead to a rise in systemic risks, hurt investors and promote financial crimes among others.
President Joe Biden has already launched several efforts towards reigning in cryptocurrencies https://www.reuters.com/technology/how-us-regulators-are-cracking-down-cryptocurrencies-2021-09-24, including a working group of top financial regulators focused on stablecoins known as the President's Working Group on Financial Markets.
A Treasury-led group also plans to recommend to the Financial Stability Oversight Council of regulators whether stablecoin activities should be designated as systemically important, the report added.
Recommendations from the Biden administration are expected to be included in the upcoming report by the President's Working Group on Financial Markets, the report added, which will possibly be published in late October.
