Charles Cascarilla, the co-founder and CEO of stablecoin issuer Paxos, believes the Biden administration’s move to regulate stablecoins is a good step in the right direction. He shared his sentiments during a November 3 interview, noting that he expects more dialogue on the matter.
interview, Cascarilla said he believes regulatory clarity and consistency will help stablecoin technology hit an adoption curve, thus spreading into everybody’s lives. He added that regulation is key to making everyone understand how they can operate in the industry, and Paxos has been pushing for regulatory clarity since the beginning.
He touted his company, saying it is the only stablecoin issuer with a primary regulator. Cascarilla further pointed out that Paxos operates through a trust company in New York. As such, regulatory clarity would help the firm change the lives of people through stablecoins.
However, he proposed that the government create a level playing field for all stablecoins. In so doing, he believes private companies will be able to innovate solutions that help the sector get more mainstream use cases. Cascarilla further noted that whether a stablecoin issuer is insured by a depository or a trust company is a matter that can be resolved.
Stablecoins will perform differently compared to the broader crypto market
Commenting on how stablecoins will fair against blockchain-native digital assets, such as Bitcoin (BTC/USD) and Ethereum (ETH/USD), Cascarilla said the two industries would have different outcomes, seeing as they do not address the same problems.
According to him, BTC is inclined towards being digital gold or a reserve asset, while ETH powers a programming layer that underpins everything. While he believes both coins have achieved significant milestones, Cascarilla claims so much more has to happen before they can unlock their true potential.
On the other hand, stablecoins help people take traditional assets and introduce them to the blockchain. Through creating this bridge, stablecoins offer traditional assets the positive traits of crypto, including markets being open 24/7, instantaneous transactions, low fees, and more inclusion, among others. As such, he believes stablecoins will become an integral part of the future finance sector.
Revolutionizing the FX market
Per Cascarilla, managing reserves that back a stablecoin is a sensitive matter, seeing as it determines the structure of a stablecoin. For instance, using securities would make a stablecoin issuer look like a bank, ETF, or mutual fund. However, using cash and its equivalents introduces stability that makes the issuer look like a money market.
By using stablecoins backed by fiat currencies only, Cascarilla believes the sector can help transform the FX market by eliminating the current nine-to-five, five-days-a-week model. Such a change would see FX markets become active all the time.
The post Paxos CEO says regulatory clarity will help stablecoins get more adoption appeared first on .
