The U.S. Treasury Secretary is pushing for better cryptocurrency regulations…
Speaking at American University, Janet Yellen said the government should focus on responsible innovation, adding that the U.S. needs regulations that work for all Americans, enforce national security, and contribute to economic growth.
She added that while crypto products and technology may help make the country’s financial system more innovative and efficient, digital assets presently remain a risk to the system – reinforcing the need for guidelines specifically surrounding the digital asset market.
In order to achieve this, Yellen noted that she will work with members of Congress to create legislation for stablecoin by the end of 2022, as their value is dictated by an external peg such as the U.S. dollar.
But given the sheer number of stablecoins in circulation that are backed by a dollar equivalent in reserve, there are many concerns about their validity… particularly in the wake of TerraUSD’s recent plummet in value.
Even so, Yellen used the latest situation as an example of why the U.S. needs to implement regulations for the rapidly growing market and pegged assets – boding well for Bitcoin (BTC) and other popular cryptos.
That’s because many governments worldwide are already looking to develop their own digital currencies. So, by building a better framework to apply to existing cryptos, it will not only make digital payments more readily available, but also potentially benefit from banking infrastructure.
In turn, this will only further legitimize the use of cryptos, spurring an even greater rise in demand. And as this happens, it could push economic powers worldwide to accelerate the development of guidelines that bring Bitcoin and other digital assets into mainstream markets.