According to the Securities and exchange Commission(SEC) senior adviser for digital assets Valerie Szczepanik, the future of stablecoins will face an uphill battle against current securities laws.
The news coming from the Austin’s SXSW conference saw her placed stablecoins into three main categories during a Q&A session.
According to her, the first category is tied to assets like real assets such as gold, oil or real estate, the second to the dollar and the third which she thinks may face serious issues with the law.
She also went further to indicate that it doesn’t matter how a blockchain project is called, be it a token or a stablecoin, it will face same scrutiny as the SEC is more interested in whats behind the project.
“Folks like to put labels on things, but we’ll always look behind the label to see exactly what’s happening… So you can call it a utility coin, call it a stablecoin, call it a consumptive coin or some other coin. We’re going to look at the characteristics. What’s the economic reality? What’s happening with the transactions involving the coin? And we’ll give it the label that it deserves under the law.”
However, businesses are expecting the upcoming months to bring some positive developments with the hope that the SEC will bring more updates in terms of regulations.
When asked about the her thoughts on the the future of stablecoins, she sub divided them into two categories, the one’s which are stable in price like Tether and the others whose value fluctuates ( algorithmic stablecoins). One of which she thinks could easily land investors into trouble.
Recently, USDT (Tether) the most popular cryptocurrency stated that it will also be pegging the USDT to other assets. The stable coin which is widely known to be tied to the dollar will now have other assets backing the coin.
What are your thoughts on the implementation of regulations in the space and the future of stablecoins? Feel free to leave a comment down below.