FDIC

CHIEF SAYS STABLECOINS COULD FUNDAMENTALLY ALTER THE BANKING SYSTEM.

Considering the profound impact stablecoins could have on the established banking system, U S regulators must ensure the digital tokens fit in without disrupting it, according to Martin Gruenberg (chairman of the FDIC). Gruenberg's agency will significantly impact how stablecoins are regulated in the United States Recent sanctions against

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Gruenberg noted that the Financial Stability Oversight Council (FDIC) also inputs into the federal government's policy towards stablecoins, which will work with the Federal Reserve's future realtime payments system, FedNow Besides being used for trading volatile cryptocurrencies, stablecoins are necessary to create a many U S banks

President Joe Biden has yet to name a permanent replacement for Gruenberg, who previously served as FDIC chairman Two people were nominated last month to join the board, and the next chairman is reportedly on the way Aside from his roles at the Financial Stability Oversight Council, Gruenberg is involved in cross-agency crypto oversight efforts� However, he has been openly skeptical of the usefulness of crypto� because "our authority is clearly limited, particularly when it comes to protecting consumers as well as provisioning of wallets and similar services by non-bank entities "

Social Media and Crypto Platforms

According to him, the industry has primarily focused on trading, and so far, we have not seen many benefits� "It remains to be seen if there is any potential there "

To deal with stablecoins, he said Congress should pass new legislation

The relationship between digital assets and social media platforms has not always been smooth sailing A ban on all digital asset ads, including influencers, was enacted by Facebook in 2019 YouTube also made similar attempts� Digital assets, however, have changed platforms' stance� The Metaverse is the next chapter in the internet, according to Mark Zuckerberg, CEO of Meta. Corporations are taking chances with blockchain and digital assets, while decentralized platforms are embracing them," he said.

Among other issues, users are dissatisfied with how corporate platforms deal with privacy, censorship, data theft, sharing, and user control� The protection from censorship that decentralized platforms provide provides them with the leverage to attract new users A single motivated individual can still disrupt a market even when the media are buggy and slow

As Gruenberg sees it, stablecoins would be sufficiently safe if they were offered through bank subsidiaries, fully backed by short-term treasury bonds, and placed on regulated "permissioned ledger systems "

"Knowing all parties involved in payment stablecoin activitiesincluding nodes and validators - is crucial to ensuring compliance with anti-money laundering regulations, preventing terrorism financing, and deterring sanction evasion "

Some decentralized platforms that could disrupt social media include Lens Protocol, Steemit, Only 1, and Mastodon The platforms have all reported a growing user base in 2022 —Crypto Weekly

—Crypto Weekly