Former Binance.US CEO and an ex-acting US Comptroller of the Currency Brian Brooks has commented on the ongoing discourse regarding stablecoin regulation in the US.
In an interview with CNBC on Friday, August 11, Brooks, now a partner at Valor Capital Group, took a stance against stablecoins opposition in the US government, saying that a proper regulatory framework for these assets could boost the relevance of the US dollar worldwide.
US Dollar Can Benefit From High Stablecoin Demand, Brooks Says
Stablecoins are a type of cryptocurrency with values pegged to a fiat currency, mostly the US dollar, or a commodity such as gold, oil, etc.
According to Brooks, nations with high inflation rates have a buoyant demand for dollar-backed assets such as stablecoins as citizens look to preserve the value of their investments and earnings.
The former acting US Comptroller of the Currency believes if the US government forms a system that oversees the use of the dollar as a reserve currency for assets, this could further boost the existing demand and even lead to a higher adoption of the US legal tender globally.
Brooks explained this to CNBC, saying:
Citizens in countries that have high inflation are really strongly demanding dollar-denominated products to keep their money safer after they’ve earned the money. In many countries where you can’t get a dollar bank account, stablecoins are your best solution.
If only the U.S. government would create a framework that allows dollars to back stablecoins in a regulated way, that demand would flourish. That would be good for dollar adoption globally, but as long as we’re allowing governments to suppress stable coins, you have the sort of push-pull phenomenon, which is what creates the problem.
To Brooks, the current demand for stablecoins can be utilized in leading the resurgence of the dollar, especially as most governments are actively working to reduce the dollar’s influence on their economy.
The former Binance.US chief expresses that policy regarding these assets should focus less on cryptocurrency but rather on the potential role the United States could play in the global financial system.
Stablecoin Regulations Continue To Gain Ground In the US
As earlier stated, there has been lots of discussion on stablecoin regulation in the US recently promoted by the action of several arms of the government.
On August 8, the US Federal Reserve introduced the “Novel Activities Supervision Program” which now mandates all banks in the US to obtain a written supervisory non-objection letter before dealing with “dollar tokens.”
Meanwhile, the US House of Representatives is set to vote on the Clarity for Payments Stablecoin. The bill was successfully cleared in July by the House Committee on Financial Services, and it aims to introduce regulations on the issuance and use of payment stablecoins in the US.
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