SEC’s Hester Peirce says new stablecoin rules should allow room for failure

Commissioner Hester Peirce, also known as the “crypto mom” of the Security and Exchange Commission (SEC), advocated a regulatory framework for stablecoins that allowed “room to fail”.

speaking online panel Hosted by the financial think tank Official Monetary and Financial Institutions Forum (OMFIF) on May 12, Peirce, a longtime cryptocurrency advocate, was asked to explain the steps U.S. regulators are taking when it comes to cryptocurrencies. .

“One place we can see any movement is around stablecoins,” Peirce replied.

“I’ve spent quite a bit of time within cryptocurrencies and have used a lot of stablecoins, so people are thinking forward. When this gets bigger, would you like to have some sort of regulatory framework?”

Peirce said the SEC is urging the SEC to use its regulatory powers to provide exemptions for certain technologies that would allow significant experimentation.

“We have to allow room for failure because it’s obviously part of a new endeavor and our framework really allows that kind of trial and error. I hope it will be used for that purpose.”

Earlier this week, officials in the US capital needed a “coherent federal framework” for stablecoins during a May 10 Senate hearing with Treasury Secretary Janet Yellen over the algorithmic defegment of the USD stablecoin TerraUSD (UST). said that Develop in light of the situation.

Two days later, on Thursday, May 12, Yellen said that the stablecoin, which removes the peg from the US dollar, does not pose a threat to the country’s fiscal stability as the price decline is not yet at a scale that could pose a risk. Currently, the top 5 USD stablecoins have a market cap of over $154 billion, coin gecko.

Relevant: SEC and CFTC chairs discuss crypto regulations at ISDA meetings.

Speaking more about the regulatory landscape for stablecoins, Peirce said it is important for regulators to remember that the term encompasses a wide variety of assets.

“When we say ‘stablecoin’, one stablecoin may not look like another. I think it’s very important to approach every conversation in cryptocurrency, understanding that there are a lot of changes that make it difficult to create a regulatory framework.”

She added that the rules “try to deal with what exists today” but “will be there tomorrow…and that’s not easy.”

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