- Stablecoin regulatory framework, Powell open to innovation and banking participation.
- Powell emphasizes consumer protection.
- Supports efforts for banking inclusion in crypto custody.
Federal Reserve Chairman Jerome Powell addresses cryptocurrency’s growing influence, advocating for stablecoin regulation. No exact date was announced, but his comments came during a recent press conference in Washington, D.C.
His statement underscores the increasing importance of stablecoins in the financial landscape. Powell stresses the need for clear legal frameworks to accommodate growing mainstream appeal.
Powell’s Backing Could Spur U.S. Banking Involvement
Jerome Powell, Chairman of the Federal Reserve, recently highlighted the need for regulatory frameworks for stablecoins. Acknowledging their rising role in finance, he called for consumer protection measures. This initiative aims to integrate stablecoins into the financial system while maintaining stability. Banks facilitating crypto transactions need to manage risks safely, as emphasized by Powell during a press conference.
Immediate changes include broader banking participation in crypto custody and a focus on stablecoin regulation within the financial system. The anticipated introduction of legal structures could drive stablecoin appeal, particularly for USD-backed coins like USDC and USDT.
“Banks are perfectly able to serve crypto customers as long as they understand and can manage the risks and it’s safe,” said Jerome Powell, Chairman of the U.S. Federal Reserve.
Market responses have been largely positive, with industry stakeholders welcoming potential new regulations. Hunter Horsley, CEO, Bitwise Asset Management, stated on X: “Banks will be a major catalyst for crypto in 2025. Mainstream era beginning.”
2025 Stablecoin Regulation Could Echo 2020’s Crypto Custody Approval
Did you know? In 2020, the OCC approved banks to provide crypto custody, spurring institutional investments. Powell’s support could have similar transformative effects by encouraging wider stablecoin adoption, echoing past regulatory impacts.
Data from CoinMarketCap reveals USD Coin (USDC) maintains a stable $1.00 price, with a market cap of $60.52 billion. Market dominance stands at 2.28%, and the trading volume is $9.96 billion, showing a 5.60% 24-hour change. Current, stable figures align with Powell’s advocacy for a regulated market.
Insight from Coincu research indicates Powell’s statements may catalyze financial sector stability by embedding regulated stablecoins into banking. Historical trends suggest that regulatory clarity can bolster industry participation, enhance legitimacy, and potentially elevate market trust.
Discussions about the STABLE and GENIUS Acts indicate momentum towards comprehensive regulatory frameworks, positioning stablecoins as a pivotal financial component.
Source: https://coincu.com/332599-powell-supports-stablecoins-regulation/