Treasury’s Liang Says Reining in Stablecoins Harder Without Federal Payments Regulator

Source: American Banker

Stablecoins have the potential to upend the payments sector, and the lack of a federal payments regulator makes it harder to tackle the problem, a top Treasury Department official says.

Nellie Liang, the Treasury Department’s undersecretary for domestic finance, said at an event hosted by the Financial Services Forum that payments are one of the first issues the department plans on tackling in a list of reports mandated by the Biden administration’s executive order to study and recommend policy around digital assets.

Liang continued to argue for Congress to pass legislation that would make it easier for the federal government to address the risks to payments posed by stablecoins.

Liang also clarified that the Biden administration’s calls for banklike regulation for stablecoin issuers wouldn’t necessarily mean that banks would be the only entities allowed to issue stablecoins. But she did say that banks could offer stablecoins, or some kind of deposits that are like stablecoins, in the future.

“I think the goal of any legislation would be to allow both banks and nonbanks to offer — or new nonbank payment kind of entities — to offer this service,” she said.