US SEC agency will not lead stablecoins regulation
Finally, the rumours of stablecoins regulation authority have been revoked by the US government regulatory group authority.
A few days ago, Bloomberg published a report and claimed that they got information from an anonymous source. According to the source, The United States Securities and Exchange Commission (SEC) will handle the regulation work of stablecoins operations. But now, the reported news of Bloomberg is going wrong because US regulation authorities give clarity on this news indirectly.
The United States President’s Working Group on Financial Markets (PWG) released a report on stable coins on 1 November. The main focus of the released document is focused on the most possible risks that can occur because of the stablecoins use in the crypto market like financial instability & risk for users.
According to the released documents, stablecoins are currently available for the use of digital assets based trade. But there are chances that it can pose a risk under the situation of retail adoption, however, chances of retail adoption are minor but still possible. On the regulation of the stablecoins, Congress will decide to provide a better regulation framework soon.
This released document by PWS almost confirmed that the SEC agency will not handle stablecoins matters i.e regulation & creating a new framework to regulate the operations.
Negative results of stablecoins regulation by the SEC agency
After the report of Bloomberg- SEC Agency authority to handle stablecoins regulation- many crypto analysts claimed that there are many risk factors if SEC will handle stable coins regulation.
The recent working process against the crypto firm by the US SEC agency showed that there are huge chances that SEC’s interference may lead to a high instability in the crypto market for stablecoins.
Regarding this concern, C. Neil Gray, partner at law firm Duane Morris shared his stance with the Cointelegraph and said
“Industry participants likely see the SEC’s push to take point in this area just as another example of SEC overreach in the cryptocurrency space, and fear that the SEC will regulate stablecoins by enforcement rather than by rule, as some perceive it to be doing in other areas.”
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