US Treasury Secretary Proposes Federal Regulation of Stablecoin Issuers

U.S. Treasury Secretary Janet Yellen told members of Congress on Tuesday that the administration's Financial Risk Regulators want to establish a minimum level of federal regulation of stablecoin issuers, a system that would set common compliance standards beyond those currently in place in states such as New York and Texas.In testimony before the House Financial Services Committee, Yellen said that the Committee on Financial Regulators, which she leads "believes it is critical to establish federal regulatory benchmarks that apply to all states, and that federal regulators should have the authority to decide whether to prohibit stablecoin issuers from issuing such assets." The issue has been a major point of disagreement over U.S. legislation to regulate stablecoins. Republicans have fought to give state regulators more power, while Democratic lawmakers and Yellen's Treasury Department have insisted on federal authority. Despite this disagreement, the committee previously approved a stablecoin bill with some Democratic support, although it is still awaiting a vote by the full House of Representatives.