Recent news around CoinDesk scaling back and the temporary pause of their ‘Money Reimagined’ newsletter underscores the harsh realities faced by crypto-reliant media platforms. These outlets are central to educating and informing both enthusiasts and newcomers about the rapid developments in crypto markets. By providing high-quality journalism, they play an integral role in tackling various challenges in these sectors while championing the transformative potentials of cryptocurrencies.
The ill effects aren’t confined to media organizations, though. A closer look reveals similar challenges in regulatory landscapes. A recently proposed bill could regulate stablecoins in the U.S. A comparative perspective, however, reveals that other jurisdictions are far ahead in this regulatory journey. This striking contrast could potentially have widespread implications on the global position of the dollar in the burgeoning world of digital currencies.
While the U.S. is contemplating its regulatory framework for stablecoins, the Monetary Authority of Singapore has already introduced a new regulatory framework, imposing minimum capital requirements on issuers. This move clearly outlines the rules of the game, potentially making Singapore a hub for these rapidly popular crypto payment modes.
Similarly, the presence of Anchored Coins, a company launched by former Singaporean parliamentarian Calvin Cheng in Switzerland, introduces stablecoins pegged to the Swiss franc and euro. Anchored Coin, as a licensed entity of Switzerland’s VQF self-regulatory organization, is authorized to issue coins under regulations established by FINMA, showing noteworthy progress in the adoption and regulation of cryptos.
The Bermuda Monetary Authority’s digital asset licensing system, established in 2018, also stands further ahead. Just last year, Jewel Bank became the first licensed entity allowed to issue its dollar-backed stablecoin. Canadian Securities Administrators also issued guidance to regulated crypto exchanges for any stablecoin listed to meet particular custodial, reserve management, and audit standards.
On the other hand, back in the U.S., PayPal partnership with Paxos provided it with the first regulated stablecoin introduced in the country. This move, while innovative, has drawn adverse comparisons to failed stablecoin enterprises like Libra. With PayPal‘s entry into stablecoins, Democratic lawmakers are prognosticating a dead route for the House stablecoin bill in the Democrat-controlled Senate, which could levy a significant impact on the overall crypto-space.
It’s an axiomatic necessity for the U.S. to catch up with international developments in stablecoin regulation to avoid jeopardizing its financial leadership. The demand for dollar-stable coins is still high. Yet, without the backing of Washington, nations with advanced regulatory systems are poised to encroach upon this opportunity, potentially damaging the dollar’s eternal appeal.
An undue delay in developing a legislative process within the U.S. could perpetuate the existing, outdated financial system, imposing unnecessary costs and barriers on individuals. The need of the hour – is a comprehensive and forward-facing policy-making approach to maximize the burgeoning opportunities within the crypto world.