FSOC Says Stablecoins Must Be Regulated
The US Financial Services Oversight Council has urged the government to create regulations for the issuance of stablecoins, citing potential risks to the financial system.
In their report on December 06, 2024, the council stated that stablecoins, if not properly managed, could pose a threat to financial stability due to their vulnerability to “runs.”
The report highlighted Tether, which currently accounts for about 70% of the total supply of stablecoins, as a significant issue. The FSOC stressed that some stablecoin issuers lack proper risk control measures and are not regulated by federal authorities.
They recommended that Congress establish a comprehensive federal framework for regulating stablecoin issuers and grant regulatory jurisdiction over the crypto market to federal agencies.