Bank Regulation for Stablecoins – President’s Working Group on Financial Markets Issues Stablecoin Report

 Bank Regulation for Stablecoins – President’s Working Group on Financial Markets Issues Stablecoin Report

November 4, 2021

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On November 1, 2021, the President’s Working Group on Financial Markets,[1] joined by the Office of the Comptroller of the Currency (OCC) and Federal Deposit Insurance Corporation (FDIC), issued its expected report (Report) on stablecoins, a type of digital asset that has recently grown significantly in market capitalization and importance to the broader digital asset markets.[2]

Noting gaps in the regulation of stablecoins, the Report makes the following principal recommendations:

  • Congress should promptly enact legislation to provide a “consistent and comprehensive” federal prudential framework for stablecoins –
    • Stablecoin issuers should be required to be insured depository institutions
    • Custodial wallet providers that hold stablecoins on behalf of customers should be subject to federal oversight and risk-management standards
    • Stablecoin issuers…

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