{"id":55994,"date":"2022-01-17T10:57:18","date_gmt":"2022-01-17T08:57:18","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=55994"},"modified":"2025-09-04T04:17:10","modified_gmt":"2025-09-04T01:17:10","slug":"us-banking-regulator-sees-potential-for-greater-trust-in-stablecoins-under-proper-oversight","status":"publish","type":"post","link":"https:\/\/u1f987.com\/en\/us-banking-regulator-sees-potential-for-greater-trust-in-stablecoins-under-proper-oversight\/","title":{"rendered":"US banking regulator sees potential for greater trust in stablecoins under proper oversight"},"content":{"rendered":"

Banking regulation can increase trust in stablecoins, said<\/a> Michael Hsu, the acting head of the Office of the Comptroller of the Currency (OCC<\/span>) within the U.S. Treasury.<\/p>\n

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The official drew attention to a hypothetical scenario of a “bank run” among stablecoin holders.<\/p>\n

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\u201cVulnerabilities [\u2026] accumulate over time and are largely ignored until a small group of participants begins to get nervous and, without attracting attention, withdraws,\u201d<\/em> he explained.<\/p>\n<\/blockquote>\n

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A trigger could be a slowdown in inflows or outflows of funds from this market segment, which could instill fear and uncertainty in investors.<\/p>\n

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\u201c[In such situations with banking regulation] reserves would be under control and checked by supervisory authorities. There could also be access for issuers to the \u201cdiscount window\u201d discount window<\/a> Fed<\/span> to meet short-term liquidity needs, if warranted,\u201d<\/em> \u2014 said Hsu.<\/p>\n<\/blockquote>\n

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Bank-level regulation would be a \u201cno-lose option\u201d for holders of \u201cthe oxygen of the crypto ecosystem\u201d \u2014 converting to fiat would not pose problems, and removing regulatory uncertainty would spur innovation.<\/p>\n

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In Hsu’s view, this would benefit the financial system as a whole, given the growing interconnection between digital assets and traditional institutions.<\/p>\n

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Hsu lamented that regulators currently cannot know for sure “how a crypto startup works overall, how much risk it takes and whether its activities are safe and sound.”<\/p>\n

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The agency head warned that the technology underpinning cryptocurrencies and governance issues around certain tokens pose challenges that require careful analysis and consideration. He urged startups to collaborate to minimize the risk of eroding trust in digital assets.<\/p>\n

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In May, the interagency sprint<\/a> with the participation of the Fed, FDIC<\/span> and OCC, began, and will continue in 2022. The result of these efforts will be defining areas of responsibility<\/a> for each regulator and building a mechanism for cooperation.<\/p>\n

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The OCC promised<\/a> in 2022 to present additional recommendations regarding the integration of cryptocurrencies into banks’ product lines.<\/p>\n

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Earlier, the President’s Working Group on Financial Markets published a report<\/a> that outlined the risks associated with stablecoins and recommended treating asset issuers like banks.<\/p>\n

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In January 2022, the FDIC-insured USDF Consortium announced plans<\/a> to create a network of banks to promote the stablecoin USDF issued by its members.<\/p>\n

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Follow ForkLog news on Facebook<\/a>!<\/p>\n","protected":false},"excerpt":{"rendered":"

Banking regulation can raise trust in stablecoins, said Michael Hsu, the acting head of the OCC within the U.S. Treasury.<\/p>\n","protected":false},"author":1,"featured_media":55995,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"1","news_style_id":"1","cryptorium_level":"","_short_excerpt_text":"","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[3],"tags":[36,807,26],"class_list":["post-55994","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-regulation","tag-stablecoins","tag-usa"],"aioseo_notices":[],"amp_enabled":true,"views":"18","promo_type":"1","layout_type":"1","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/55994","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/comments?post=55994"}],"version-history":[{"count":1,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/55994\/revisions"}],"predecessor-version":[{"id":55996,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/55994\/revisions\/55996"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media\/55995"}],"wp:attachment":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media?parent=55994"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/categories?post=55994"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/tags?post=55994"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}