The currency controller of the United States has made a proposal to create stablecoin standards, as well as the “www” exists for the internet. Such a proposal could change the way these coins are traded and used by companies that issue them. Public and decentralized cryptocurrencies like Bitcoin, for example, are built on ideals from their own community, based on the vision left by Satoshi Nakamoto when he created the technology. After that, several cryptocurrencies emerged in the world that are centralized and follow only what their creators decide. Examples of these creations are stablecoins, coins that use blockchains and are backed by some asset. The most famous stablecoins are those issued with a dollar counterpart, such as USDT, BUSD and USDC. These are cryptocurrencies with daily trading volume in the billions of dollars. Among its main function is the possibility for cryptocurrency exchanges to list stablecoins with cryptocurrency pairs, allowing traders to seek coins with more fixed values when in their operations. So, with stablecoins, operations help those who don’t want to convert values to fiat currencies. In many countries, it is worth mentioning, stablecoins are already used as a means of payment in commerce. In Argentina, the use of USDT grows with the country’s inflation recording consecutive records.
“Stablecoins should meet single standard, just like www,” suggests interim US currency controller
Several companies issue stablecoins today, such as Circle (USDC), iFinex (USDT) and Binance (BUSD). Thus, each stablecoin is issued on its own network, so they do not talk to each other in their innovations. But for the acting controller of the US currency, Michael Hsu, everything should change in this sector in the future, meeting standards created by companies, governments, cryptocurrency companies and academics. “Emerging technologies like AI and stablecoins enable transactions on blockchain-based systems. Stablecoins have no shared standards and are not interoperable. To ensure that stablecoins are open and inclusive, I believe a standards-setting initiative similar to that undertaken by the IETF and W3C needs to be established, with representatives not only from crypto/Web3 companies, but also including academics and government.” Hsu further said that he spoke with Commerce Department Deputy Secretary Don Graves, where he shared this need for change. He said government bodies like NIST and OCC are on hand to help create standards for stablecoins.
Pressure on stablecoins
The new talk about the possibility of creating standards for stablecoins made by the OCC member is part of a broad discussion about the cryptocurrency sector. In this way, stablecoins and DeFi have attracted the attention of regulators, who hope to create rules for the sector and mitigate the alleged damage they can cause to the traditional financial system. It is worth remembering that in November 2021, the G20 said that stablecoins should not operate without regulation, showing that there is an interest in creating rules and standards for these private cryptocurrencies.