In a highly anticipated report, the Treasury Department, Federal Reserve and other regulators urged lawmakers to let them police stablecoin issuers like banks with robust capital requirements and constant supervision. But as a Plan B, the watchdogs made clear they would activate a rarely used power to examine whether the coins pose a systemic threat to financial stability -- a review that could trigger a raft of new rules.
“The rapid growth of stablecoins increases the urgency of this work,” the regulators said. “Failure to act risks growth of payment stablecoins without adequate protection for users, the financial system, and the broader economy.”