US Treasury Secretary Janet Yellen has been an outspoken cryptocurrency cynic. Recently, she talked about the risks associated with the nascent industry during her spending on Digital Assets. She also recited the agenda of the crypto-related Executive order issued by President Biden. Yellen also reflected the need for cryptocurrency regulations.
She claimed that the recent popularity of cryptocurrencies among the masses has also brought many risks in addition to growth opportunities. She claimed that only a decade ago, such massive changes in the financial mainframe were unimaginable. During her speech held in Washington, D.C. American University also reflected on stablecoins.
Future of Stablecoins and CBDCs
Talking about the stablecoins provisions, Yellen claimed that stablecoin issuers would be held accountable for maintaining a viable backup reserve to avoid any sudden crashes. She also recalled a stablecoin crash that occurred last year in June that was sparked by a sudden price crash of the digital currencies that backed that stablecoin project.
Experts postulated that she was alluding to an infamous crash of the TITAN token that went from $65 to zero in June and another stablecoin called IRON that fell from its peg with the USD. Yellen refrained from commenting on the matter of CBDCs, claiming that the jury is still out on the matter. It is worth noting that Biden’s EO has charged the state departments to research on CBDCs and present a joint report.
Janet Yellen claimed that the FedNow payments platform will be ready for launch in 2023. She further explained that the program would allow the users to make online payments in real-time taking reference from the central US payments system. She also claimed that the state needs to focus on tech-neutral financial regulations that will warrant the interests of the citizens rather than secure capitalists.
She also claimed that crypto and all other online custodial services should be held accountable to ensure that the reserves of the users are not lost or misplaced without authorization. She also highlighted the need for tax payment calculations available within all online custodial services that will help the users to measure and pay their taxes on time and without any hassles. She proposed the same type of tax reporting legislature for the cryptocurrency traders as stock investors.