We found this interesting article on the blog of Daniele Marinelli, an Italian entrepreneur leading DTSocialize holding Ltd, a fintech company specialized in providing services and holder of the DTCoin token. We thought of sharing it to offer readers an in-depth insight into the topic of Stablecoins.

Definition of Stablecoins

During a recent meeting, Jerome Powell, the Chairman of the Federal Reserve of the United States, defined stablecoins as a form of digital currency. These cryptocurrencies stand out for their link to a stable reserve asset, from which they derive their name. The main characteristic of stablecoins is reduced volatility, making them more predictable and measurable compared to other cryptocurrencies.

This stability makes them ideal for the everyday exchange of goods and services. Stablecoins play a fundamental role in the world of cryptocurrencies. Unlike traditional cryptocurrencies that are often treated as investments, stablecoins are primarily used as payment currencies. Their stability makes them ideal for transactions that require a reliable monetary base. This makes them preferred tools for industry experts and individuals for daily transactions.

Debates on Stablecoin: Waters’ Words and Powell’s Response

The controversy surrounding stablecoins has recently emerged in the legislative field, as explained in this piece by Daniele Marinelli (Ushare, DTSocialize, DTCoin). Maxine Waters, a member of the House Financial Services Committee, raised the issue of bills proposed by Republicans regarding stablecoins.

These proposals aim to create different licenses, with a significant impact on state preemption. In response to this, Jerome Powell stated that considering stablecoins as a form of payment currency similar to FIAT and allowing the creation of a large amount of private money at the state level would be a mistake.

Different Perspectives of Regulatory Authorities on Stablecoins

Finally, as read in Daniele Marinelli’s blog, holder of ushare social profit marketing, it is important to know the position that competent authorities take on Stablecoins. Powell’s statements highlight a divergence of opinions among regulatory authorities. Gary Gensler, Chairman of the Securities and Exchange Commission (SEC), considers stablecoins as shares of a money market fund or another type of security. This view is not far from that of Rostin Behnam, Chairman of the Commodity Futures Trading Commission (CFTC), who considers them as commodities. The different interpretations create an ongoing debate on the status of stablecoins and the regulatory implications that arise.