What Does The US Administration Think About Cryptocurrencies! Official Name Explained!

US officials spoke specifically about stablecoins. When will cryptocurrency regulation come?

Consumer Financial Protection Bureau (CFPB) director Rohit Chopra made important statements today. The US stance on cryptocurrencies and especially stablecoins is closely watched by investors. What does the US administration plan for the cryptocurrency market? What did the CFPB Director say? Details about cryptocurrency regulations and the current position of the US are in our news.

US Cryptocurrency Ban

The US has not yet taken a clear ban on cryptocurrencies. Except for banning the use of mixers such as Tornado Cash, they have not taken any steps in this direction. As a matter of fact, they announced last year that they would not follow in China's footsteps. This embracing rhetoric prompted many cryptocurrency miners to move from China to the US. Bitcoin's global hash power has recovered rapidly and climbed even above the levels before the Chinese bans.

Rohit Chopra, Director of the Consumer Financial Protection Bureau, also sits on the Financial Stability Oversight Council and his statements are important for us to understand the US position. Chopra said that stablecoins have risks to the rest of the financial system and this is being monitored.

Speaking at the annual Washington conference of the Electronic Transactions Association, a trade group for payment service providers, Chopra listed a number of concerns about stablecoins. This included their similarity to money market funds and the impact on global financial stability if they were widely and rapidly adopted for payments. The CFPB director said the Facebook-backed stablecoin experiment was the first move that prompted regulators to act.

US Cryptocurrency Regulation

The risk posed by stablecoins was not easily explained by US authorities. Fortunately, Do Kwon came to the rescue. He launched a second algorithmic stablecoin project, and this time his venture went bankrupt, wiping tens of billions of dollars off the cryptocurrency markets. Yellen, Gensler and other US officials saw their opportunity. They called for urgent regulation of stablecoins in the wake of the TerraUSD collapse. Yellen even said that regulation should be completed by the end of 2022.

For now, the US has not announced a comprehensive regulation on stablecoins, DeFi and the rest of cryptocurrencies. The process continues with reports after Biden's executive order. Expectations are that the US will announce comprehensive regulations on cryptocurrencies in 2023. For now, there is no legal framework for cryptocurrencies, except for a few steps taken on urgent issues (for example, the ban on Tornado Cash for money laundering).

But the SEC is already inviting cryptocurrency projects to register with them. It seems that the main agenda of cryptocurrencies in 2023 will be the negative effects of regulations. Gensler's call may evolve into a "we called and you didn't come, now we're suing" discourse next year.

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