Regulations for Stablecoins Almost Ready: Blockchain Association
Calls for more transparency in the process of crypto regulation in the United States are increasing. The latest to join the trend is the Blockchain Association, with the wave of enforcement action continuing as the Securities and Exchange Commission ramps up its war on crypto.
On February 22, Blockchain Association CEO Kristin Smith told Bloomberg that the crackdown has been a “behind closed doors” operation targeting specific companies under certain circumstances.
“What we really need is a more open process where we look comprehensively at the entire marketplace. [Regulators need to] figure out the right way to regulate different actors within the crypto ecosystem, and move forward in an open process where everyone can participate.”
The Blockchain Association is the collective voice of the crypto industry, with around one hundred members that include the sector’s leading investors, companies, executives and projects.
Stablecoins need addressing
She added that Congress needs to legislate, but the process is very slow and regulators like the SEC step in and take their own actions. The agency has targeted stablecoins recently as it seeks to label anything related to crypto as a security.
Smith acknowledged the new House Subcommittee on Digital Assets, Financial Technology and Inclusion that was announced in mid-January, adding that she was confident about stablecoins.
“This is an issue that Congress has been looking at since 2019, and there have been hearings in both the House and the Senate,” she said, before adding, “Last year we came very close to getting some bipartisan legislation,” she said .
The work on the stablecoin legislation is done and ready to go, Smith said. Congress just needs to pull the trigger, but nothing happens quickly in the bureaucratic circles of American politics.
Address regulatory concerns
The main accusation that US (and global) regulators make is that crypto is used for money laundering and financing terrorism. Smith argued that most centralized exchanges already have solid AML (anti-money laundering) and KYC (know your customer) provisions in place.
She added that there are specialized research firms that work with law enforcement and centralized exchanges to find out where the criminals are and where the money flows.
“[Crypto] is actually much more transparent than we see in the traditional financial services system,”
“We don’t think there’s a problem there,” Smith said, as the U.S. dollar is the primary choice for criminals and money launderers. The legislation is necessary on the stablecoin and market side, she concluded.
