The U.S. government has engaged substantially with crypto and its affiliated industries for quite some time. After passing the new infrastructure bill with crypto tax provisions, the President’s Working Group (PWG) on Financial Markets has issued a report regarding U.S Stablecoin.
However, the crypto industry has given mixed reactions to this report. Two of the top 10 stablecoin issuers have appreciated the report recommending stricter oversight over the market. According to them, this is a welcome step towards regulatory clarity.
Co-founder and chairman of Circle, Jeremy Allaire said:
“We are fully supportive of the call for Congress to act and establish federal banking supervision for stablecoin issuance.”
Other than USDC, Market leader Tether has also lauded the report. Moreover, Paxos and Gemini have also given statements regarding their report. However, their comments were more diplomatic rather than appreciative.
While stablecoin issuers have spoken positively about the report, lobbyists for the industry are critical of the report. Coin Center & Chamber of Digital Commerce warned that such a regulatory oversight would cease innovation. Such oversight will single out stablecoins among payments systems such as PayPal.
Eswar Prasad, a Cornell University economist, has given his views about the upcoming regulatory oversight on stablecoins:
“The crypto industry is trying to walk a fine line between benefiting from the legitimacy provided by government oversight while trying to stay clear of extensive and intrusive regulation that deters innovation.”
Such a rift between the practitioners’ praise and the advocates’ attacks on the U.S. Stablecoin report provides the fragile spot the community finds itself in, given its unknown regulatory status and mixed public perception of crypto.