The U.S. Senate Banking Committee held a hearing on stablecoins. Senators expressed opposing opinions.
The U.S. Senate Committee on Banking, Housing, and Urban Affairs held a hearing on stablecoins, how they work and the risks involved.
Senator Sherrod Brown was sharply critical of stablecoins. The main theses of his report were:
- cryptocurrencies are not an alternative to the existing banking system;
- high volatility and transaction fees make cryptocurrencies useless for payments;
- stablecoins are not decentralized and transparent;
- stablecoins make it easier for investors to invest in the “next bubble.”
- stablecoins make investments untethered from reality because the crypto market is a “fantasy economy.”
At the same time, the senator admitted that U.S. citizens are really looking for an alternative to the traditional banking system.
Senator Pat Toomey presented an alternative view on stablecoins. He argued that they are an innovative financial instrument that can make transactions faster and cheaper, enhance business opportunities, and help develop the digital economy as a whole.
He also criticized the proposal by representatives of the U.S. President’s Working Group on Financial Markets to equate the issuers of stablecoins to banks. In Toomey’s opinion, such an approach would “stifle financial innovation.” The U.S. Senate held a hearing on the crypto industry a little earlier. CEOs from major crypto companies attended the hearing.