- Janet Yellen alerts Congress to crypto risks: stablecoins, platform runs, price volatility.
- FSOC’s focus on digital assets’ vulnerabilities highlighted.
- Collaboration urged for enforcing regulations and passing new legislation.
- Testimony emphasizes regulatory oversight and legislative action.
- Yellen underscores need for coordinated approach to safeguard financial system.
Testimony Janet Yellen Highlights Concerns :
U.S. Treasury Secretary Janet Yellen is set to speak to Congress about the potential hazards posed by the cryptocurrency business, focusing on stablecoins, platform runs, and price volatility.
FSOC’s Focus on Crypto Risks :
Yellen’s statement, which was previewed on Monday, emphasises the Financial Stability Oversight Council’s (FSOC) focus on cryptocurrency-related risks. The FSOC, which is made up of the chiefs of the United States’ financial agencies, strives to prevent financial crises by identifying and responding to emerging dangers.
Specific concerns were highlighted :
Yellen emphasised the council’s focus on digital assets and the vulnerabilities they bring. She highlighted the hazards of crypto platform runs, price fluctuations-induced instability, and the development of platforms that operate outside of regulatory frameworks.
Collaboration With Congress :
In her prepared remarks, Yellen emphasised the necessity of implementing existing laws and asked Congress to approve legislation governing stablecoins and non-security crypto-assets traded on spot markets.
US Treasury Secretary Janet Yellen is preparing to brief Congress on the potential hazards involved with the cryptocurrency business. In a preview of her impending testimony released on Monday, Yellen expressed concerns about stablecoins, platform runs, and erratic prices.
Yellen is expected to testify before the House Financial Services Committee about the Financial Stability Oversight Council’s recent activities. This group, chaired by Yellen, is made up of executives from different US financial agencies and is in charge of identifying and addressing systemic risks.
The FSOC has significantly increased its investigation of crypto-related issues in recent years, recognising them as one of the most pressing concerns. Yellen’s comments demonstrates the council’s commitment to tackling the issues raised by digital assets.
Yellen’s prepared testimony, which is available on the committee’s website, discusses the specific risks highlighted by the FSOC. These include the possibility of runs on crypto-asset platforms, the destabilising consequences of price volatility, and the growth of platforms that operate outside of regulatory authority.
Looking ahead, Yellen emphasised the need of regulatory authorities and Congress working together to effectively manage these risks. She emphasised the significance of implementing existing laws while pressing for new legislation to govern stablecoins and other non-security cryptoassets traded on spot markets.
In conclusion :
Treasury Secretary Janet Yellen’s upcoming testimony highlights the FSOC’s continuous efforts to monitor and manage the dangers connected with the cryptocurrency industry. Yellen emphasises the significance of regulatory supervision and legislative action in protecting the financial system from new vulnerabilities posed by digital assets.