With digital assets steadily becoming more integrated into the financial system, U.S. Federal Reserve Chair Jerome Powell has once again voiced support for creating a clear regulatory framework for stablecoins.
Speaking on April 16 during a panel at the Economic Club of Chicago, Powell addressed the ongoing development of the crypto industry. He acknowledged that, despite past issues like major collapses and scams, the sector has managed to present a use case with “broad potential appeal.”
Reflecting on the turbulent period crypto faced in 2022 and 2023, Powell noted that the Fed had already collaborated with lawmakers in an attempt to lay down regulatory groundwork for stablecoins. “It would’ve been a solid starting point,” he said, adding, “Unfortunately, we didn’t succeed.”
Now, Powell believes the environment is shifting. “As crypto becomes more mainstream, there’s renewed interest in Congress to revisit the idea of stablecoin legislation,” he said. “It’s something we need. Right now, there’s no proper legal framework in place.”
This isn’t the first time Powell has stressed the importance of stablecoin regulation. Back in June 2023, during a hearing with the House Financial Services Committee, he referred to stablecoins as “a form of money” that requires strong federal oversight.
Momentum Builds for Stablecoin Rules
With the election of Donald Trump bringing a more crypto-friendly stance to Washington, regulatory efforts around digital assets are accelerating.
Earlier this year, the administration introduced the President’s Council of Advisers on Digital Assets, appointing Bo Hines as its executive director. At a digital asset summit in New York last month, Hines emphasized that passing stablecoin legislation is a top priority. He mentioned that following the Senate Banking Committee’s approval of the GENIUS Act, a final version of the bill could reach the president within two months.
Stablecoins pegged to the U.S. dollar remain the most widely used in the crypto ecosystem, playing a key role in both trading and cross-border payments. According to RWA.xyz, the total market cap of stablecoins stands at $227 billion, with USDC and USDT making up over 88% of that figure.
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