Martin Gruenberg – Chairman of the Federal Deposit Insurance coverage Company (FDIC) – has expressed fear over how stablecoins may have an effect on U.S. banking.
- Throughout a speech on the Brookings Establishment on Thursday, the chairman said a cost stablecoin may “fundamentally alter the landscape of banking.”
- “Economies of scale associated with payment stablecoins could lead to further consolidation in the banking system or disintermediation of traditional banks.”
- Federal Reserve Vice chair Lael Brainard has beforehand famous comparable dangers, recommending a CBDC to assist unify the banking system.
- Such stablecoins may additionally encourage some people and companies to finish relations with their current banks, based on Gruenberg.
- The chairman really useful making stablecoins safer by ensuring their issuers had been subsidiaries of federally regulated banks.
- With regulation, they could present vital advantages, “especially to the extent [they] foster an inclusive, real-time payments system,” he stated.