Subnostr

Strategically, the US Treasury has no interest in killing the #DeFi ecosystem. However, it wants to ensure that a treasury backed stablecoin remains the dominant #stablecoin in the ecosystem as to grow the global demand from US treasuries from this ecosystem.

As we are seeing with the #Mica regulations coming for the EU, the US Treasury cannot count on centralized exchanges regulated by foreign jurisdictions to keep US backed stablecoins on those platforms.

Also, the US Treasury doesn’t want to see the emergence of #crypto backed stablecoins that could compete against US backed stablecoins.

If you look at the #FIT21 bill and other proposed US bills, it seems that keeping DeFi out of reach of the regulators plus establishing a standard for a US backed stablecoin are two strategic moves that would align with the interest of the US Treasury to grow an emerging demand channel for US treasuries.

mister_monster 1y ago

Does FIT21 ban algorithmic stablecoins backed by other collateral or pegged to other metrics?

Reply to this note

Please Login to reply.

Discussion

LogicallyMinded 1y ago

As it pertains to #stablecoin, #FIT21 only refers to « permitted payment stablecoins » which are defined as stablecoins backed by national currencies such as #USDT or #USDC. It doesn’t seem to indicate a ban on other forms of stablecoins or how those would be treated. I understand that they would be treated like others digital assets meaning as a security or commodity depending on the level of decentralization.

LogicallyMinded 1y ago

I just learnt about a bad bill aiming to ban algorithmic #stablecoin that was introduced by Sen. Lummis who’s viewed as pro #crypto.

https://www.coincenter.org/senate-bill-risks-innovation-and-free-speech-with-stablecoin-ban/