Washington D.C. — U.S. Treasury Secretary Janet Yellen on Wednesday reiterated the importance of building a regulatory framework for digital assets, referencing Terra as one possible danger and the tether stablecoin's “breaking the buck” as a result of the crypto crash.
In a conversation at the International Monetary Fund’s (IMF) annual meeting here, Yellen said that while there are more existing regulations “than people think” that can be applied to crypto, there are also many “holes” that need to be addressed.
Yellen said she would like to work with Congress to fill those holes as digital finance is “a tough thing to regulate,” she said.
As for a U.S. central bank digital currency, Yellen thinks a CBDC has advantages and the potential to solve many problems. While the process of creating a CBDC could take many years, it is “certainly worth getting involved in developing.”
“We can continue to think about whether it’s right to implement,” she said, but the U.S. should be “in a position where we could issue one.”
Last week, the Financial Stability Oversight Council (FSOC), of which Yellen is a member along with Federal Reserve Board Chair Jerome Powell, among others, published a report asking Congress to step in to provide guidance on what should be the limits of securities regulation.
UPDATE (Oct. 13, 2022, 21:18 UTC): Updates headline.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.