Stablecoins are not the same as cryptocurrencies, as these are only the mirror images or reflections of these cryptocurrencies. The stablecoins are specifically pegged against a definitive commodity such as another cryptocurrency or even the US dollar. Their value is in reference to a definitive or competitive commodity which they are representing. There are worries, especially in the US, that what if too many people decide to withdraw their stablecoins and all at the same time, what would it mean for this potential market?
It simply means that the whole market would be out of the whack completely, and it could take months to make amends and ensure stability and consistency within the market. The United States Treasury Department has finally decided to regulate these stablecoins as their growth increases, and people are getting more and more interested in them as a potential mode of investment.
US Treasury is Considering Imposing Strict Regulations
Only the recent week Treasury called for a meeting in which stablecoins were discussed in detail, such as what are their benefits, how these work, and if they are any threat to modern finance or the fiat centralized world. There were various suggestions made by the policymakers regarding the regulations which the US Treasury Department should enforce for the stablecoins. To come to a conclusion about this, the Treasury Department is expected to meet a broad set of people such as the stakeholders, consumer advocates, market analysts, and members of Congress.
There is still a lot to figure out, such as if stablecoins are as direct or extreme in measure as cryptocurrencies are or should be taken lightly and given a green pass to proceed without the need for any regulations whatsoever. The only thing that is forcing the US Treasury Department to even consider imposing regulations is that people are becoming more aware of what stablecoins are and how these work. This could end up being a direct investment vehicle just like cryptocurrencies are, and with enough people taking an interest, it could even start off in the form of stablecoin trading, which is a point where the Treasury needs to jump in to impose regulations.