59
The United States Treasury Department has been meeting with the different groups that are invested or involved in stablecoins to investigate possible issues that could arise and what would be done in said situations. What is good about the reports coming out so far is how the department is looking at this from all sides. They are not hunting to find reasons to regulate and the questions that have been asked are ones that seriously need to be considered.
The most apparent of these is the question of what would happen if too many people withdrew their coins at the same time. Due to how Tether does not have a true 1:1 backing as they have claimed previously in theory their system could be overwhelmed and the coin could fail if everyone tried to redeem them to their $1 value. This wouldn't just be bad for the US but for the crypto market overall and would wreak havoc across the industry. It makes sense that the government would look at if basic regulations would be put into place. After all they do not want harm to come to the dollar along with dealing with hundred of thousands or millions of Americans who could get swept up and hurt by this!
By talking to all of those involved its nice to see them include companies like VISA and Mastercard since they have added new crypto features. This is also probably being done to check on Circle who is the organization that controls USDC! Plus by understanding the technology for they can better decide if a CBCD is in the cards or not. CBCD's seem to be a hot butt issue as well however I do see where they could be a pretty useful tool for the government. If anything they could reform their current finance system to more mimic the way that blockchain works to speed up transaction times and settlements. This I believe would get rid of the need of CBCD for the most part as long as citizens had a bank account instead. I do see though where they could allow for government encroachment and issues with governments slowly erasing the benefits of blockchain and cryptocurrency.
For now though since no rules are being enacted or even proposed and this all is fact finding right now I am all for it. I would much rather the government understand then just act or not act without actually knowing what the heck was happening! Let me know how you feel in the comments below!
