As a seasoned researcher with extensive experience in the field of blockchain technology and stablecoins, I find the recent development regarding the Bank for International Settlements (BIS) new guidance on permissionless stablecoins such as Tether’s USDT and Circle’s USDC to be concerning.
Stablecoins, like Tether’s USDT and Circle’s USDC, which are issued on decentralized blockchains, could be subject to increased regulatory scrutiny following new guidelines issued by the Bank for International Settlements (BIS).
BIS Targets Stablecoins like USDT and others
On July 17, 2023, the Basel Committee on Banking Supervision released the final version of its report detailing how banks should disclose their involvement in crypto-assets. This means that financial institutions will be required to provide both qualitative and quantitative information regarding their crypto-related transactions, as well as the necessary liquidity plans to ensure market stability.
The regulations for certain favored stablecoins have become more stringent.
The Basel Committee has issued new guidelines for stablecoins aiming to enhance the eligibility requirements, allowing select stablecoins to benefit from favorable regulatory handling. These modifications will take effect on January 1, 2026. For further details, please refer to this link: [Basel Committee’s cryptoasset standard update](link).
— Bank for International Settlements (@BIS_org) July 17, 2024
As someone who has closely followed the cryptocurrency landscape over the past few years, I’ve witnessed the meteoric rise of stablecoins like Tether (USDT) and Circle’s USD Coin (USDC), which offer a more stable alternative to traditional cryptocurrencies by being pegged to fiat currencies. However, recent developments in regulatory circles have cast a shadow over their future.
Crypto Industry Veterans Lash Out At BIS
Caitlin Long, the CEO of Custodian Bank, voiced her disappointment with the BIS’s latest ruling. According to this decision, banks are no longer permitted to utilize stablecoins issued on decentralized blockchains. Instead, the BIS is advocating for permissioned stablecoins.
She added her thoughts, lamenting that the US might disregard this new development: “Unfortunately, it’s highly probable that the US will overlook this. Regrettably, BIS had been at the forefront of US crypto regulation but seems to be taking a step back now.”
Last month at Coinbase’s State of Crypto event, I had the opportunity to hear BlackRock’s Head of Digital Assets express their newfound belief in the superiority of public blockchains over private ones.
The Bank for International Settlements (BIS) has recently recommended that banks adopt only permissionless stablecoins, such as JPMorgan’s JPMCoin, in their operations. Notably, banking giant State Street is reportedly intending to launch its own stablecoin. This development could potentially weaken the position of existing permissionless stablecoins like USDT in the market.
According to a tweet from Eleanor Terret on Fox Business X, the preliminary plan supposedly involved the inclusion of USDC and other stablecoins in a specific category. However, the final instructions apparently shifted, excluding all stablecoins issued on decentralized or permissionless blockchains.
Read More
- LUNC PREDICTION. LUNC cryptocurrency
- BTC PREDICTION. BTC cryptocurrency
- USD COP PREDICTION
- SOL PREDICTION. SOL cryptocurrency
- Ethereum (ETH) Crashes Dramatically, What’s Next? Solana (SOL) Can Still Reach $200, XRP Struggling Before $0.63 Test
- DOGE PREDICTION. DOGE cryptocurrency
- Profit from the Dip: Hong Kong To Debut Asia’s First Inverse Bitcoin ETF — Here’s When
- I Physically Need WWE 2K25’s Showcase to Feature The Bloodline
- Bitwise Ether ETF Reveals 10% Profit Donation To Ethereum Developers
- Cardano Enters Chang Hard Fork Era With Node 9.1.0 Upgrade
2024-07-18 09:26