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It’s Time to Regulate Cryptocurrencies

WASHINGTON, D.C. – The President’s Working Group on Financial Markets released a report today on the risks of cryptocurrency and related stablecoins, which are pegged to a more stable asset such as the dollar. The working group consists of the U.S. Treasury Secretary, and chairs of the Federal Reserve, the U.S. Securities and Exchange Commission, Commodity Futures Trading Commission. Bartlett Naylor, financial policy advocate for Public Citizen, released the following statement:

“We applaud the president’s working group for its high-level attention to the fast evolving, trillion-dollar, wild west of finance. And we welcome the interest in oversight from the Financial Stability Oversight Council, which is charged with monitoring systemically important financial institutions.

“Fortunately, financial statutes for banking, securities, commodities, and consumer protection agencies already provide a robust foundation for regulators to address many of the problems facing investors and consumers – and these agencies have indicated that they are ready to address the threats posed by cryptocurrency. In addition to regulation, congressional action may be needed to bridle the likes of Facebook and its proposed stablecoin ‘Diem’ before it entices billions of users. But relying on this congress to rewrite the law for all cryptocurrencies could be a jump ball in a game that Wall Street knows all too well how to rig.

“Our payment system can be improved, especially for lower-income, unbanked citizens. But the eyes of those now promoting stablecoins are alit with dollar signs that come from a new source of fees, not from the inner warmth of a selfless good deed.”