According to Blockworks, US financial leaders are examining cryptocurrency from both regulatory and innovative perspectives. At the DC Fintech Week event in Washington, officials discussed the need for the Federal Reserve to increase its oversight of the stablecoin ecosystem and the potential benefits of increased tokenization for the Office of the Comptroller of the Currency, which oversees the American banking system. Michael Barr, the Fed's Vice Chair for supervision, emphasized the importance of learning about new technology and harnessing private sector innovation in stablecoins to improve payment system efficiencies.
Acting US Comptroller of the Currency, Michael Hsu, agreed and argued during a separate panel that blockchain technology could be a game changer in the settlement space. He said tokenization is focused on solving the problem of settlement, but the crypto industry as a whole remains less promising due to frauds, scams, and hacks. Barr added that significant oversight from the central bank is essential, particularly in the stablecoin space, to protect the financial system. He also mentioned that the Federal Reserve has a strong interest in ensuring stablecoin offerings operate within an appropriate federal prudential oversight framework to maintain financial stability and payment system integrity.
In terms of federal policy, lawmakers on both sides have shown interest in getting stablecoin legislation to President Joe Biden's desk. The House Financial Services Committee advanced the Clarity for Payment Stablecoins Act, a bill that gives more power to state regulators in licensing issuers. Central bank digital currencies (CBDCs), however, have emerged as a more partisan issue. Barr added that the Fed is currently in a strictly research-only phase of their investigations into a CBDC.