Home Alt coins Former head of the US Treasury urged to store stablecoins in banks

Former head of the US Treasury urged to store stablecoins in banks

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Former Treasury Chief Steven Mnuchin Calls For Regulated Banks To Control Stable Coin Collateral

Former US Treasury Chief Steven Mnuchin criticized the existing stablecoin business model. In an interview with Bloomberg, he stated that stablecoins should not be in the hands of individuals. The collateral for this type of cryptocurrency should be kept in regulated banks, he said.

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“They [стейблкоины] shouldn’t look like casino chips. If you are going to issue stablecoins, real money must be held in a regulated bank, in a trust account, and people who own stablecoins must be able to exchange them for real dollars at any time, ”said Mnuchin.

At the same time, according to the former head of the US Treasury, stablecoins should be used as collateral US Treasury bonds. He also spoke in favor of free circulation of these coins, if they are backed by dollars. However, the US authorities first need to make sure that stablecoins are indeed backed by currency, he added.

Earlier, the chairman of the US Securities and Exchange Commission (SEC), Gary Gensler, in an interview with The Washington Post, compared stablecoins to “casino poker chips.” Then the head of the SEC proposed to expand the powers of the department. However, Gensler was never able to clearly explain why the exchange regulator needs more power in terms of regulating cryptocurrencies.

Read also: Treasury Lobbies Investigation Against Stablecoins

Meanwhile, Federal Reserve Chairman Jerome Powell has denied plans to ban cryptocurrencies and stablecoins. However, stablecoins, according to Powell, are still similar to money market funds. It is advisable to regulate such assets, since they, to some extent, are outside the regulatory perimeter, the head of the FRS added.

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