Now the United States government is moving towards the adoption of the crypto world. The current chairman of the US Federal Deposit Insurance Corporation (FDIC), Martin Gruenderg, stated that the organization needs to know more information related to cryptocurrency and the entities that are involved in cryptocurrency have to understand the FDIC agency better.
The FDIC agency is now trying to work on regulations for stablecoins. Stablecoins will have a great impact on establishing the banking systems in the United States. To ensure the users’ safety, the FDIC has taken certain steps towards regulation of stablecoins.
Gruenberg assured customers by making stablecoins safe in three ways:
- By putting them on permissioned ledger systems.
- By providing short-term Treasury bonds.
- Offering through bank subsidiaries.
Gruenberg stated that “The development of a payment stablecoin could fundamentally alter the landscape of banking. Payment stablecoins could change how credit is extended within banking, possibly leading to forms of credit disintermediation that could harm the viability of many United States banks and potentially create a foundation for a new type of shadow banking.”
Recently, to get involved in the crypto space and currency market, NIST announced draft regulations on the stablecoin platform. For a better understanding of stablecoin technology and its security-related guidelines, NIST recently prepared a draft to ensure the safety and security of stablecoins. The researchers took 20 stablecoins as samples to examine their value stability. They also added the major components of stable coins in their report, like their smart contracts, blockchain ledgers, and digital currencies.
In the middle of May, the circulation of stablecoins was reduced by nearly $38 billion (USD). Still, $148.7 billion (USD) is in circulation, the majority of which is Tether, USD Coin, and Binance. Because of their decentralized structure, stablecoins are facing issues with deposits, which are not easy to acquire at interest rates on, unlike fiat deposits.
The top five stablecoins that retained their peg with an average of 87% are as follows:
- Tether
- USD Coin
- Binance USD
- Dai
- Frax
“The ability to know all the parties, including nodes and validators, that are engaging in payment stablecoin activities is critical to ensuring compliance with anti-money laundering and countering the financing of terrorism regulations and deterring sanction evasion.”
Source: https://www.thecoinrepublic.com/2022/10/21/the-us-fdic-decided-to-alter-the-banking-system-through-stablecoins/