Terra LUNA Collapses, SEC Calls For Accelerated Regulation Of Stablecoins

SEC calls for accelerated regulation of stablecoins after Terra crashes. (Twitter: Terra)

JAKARTA – SEC (US Securities and Exchange Commission) Commissioner Hester Peirce has signaled that regulation around stablecoins will be accelerated after the Terra ecosystem experiences a sharp decline. Pierce said it is possible to accelerate regulation of stablecoins in the United States.

Reporting from CryptoPotato, Peirce, who is also known as 'Crypto Mom,' said that there may soon be a move to stablecoin regulations in the US. The comments came at an online panel debate hosted by the London-based Official Monetary and Financial Institutions Forum (OMFIF) policy think tank on May 12.

The SEC commissioner said that one place we might see some movement is around stablecoins. This refers to stricter regulations for the crypto sector.

Regarding the crash of stablecoin TerraUSD (UST) he said, "That's an area that's definitely gotten a lot of attention this week."

The SEC itself has the opportunity to capture digital currencies, and the technology platforms on which they are traded" under its jurisdiction.

Bureaucratic laws and regulations move very slowly in the United States. Approaches to stablecoin rules are also lacking in specifics. However, with the current events facing UST, things can be accelerated.

SEC Chain Gary Gensler still considers it a security. This leads to nothing good that might come out of tighter control over crypto.

He believes he believes stablecoins and cryptocurrencies pose a threat to money markets and the banking sector. So, they should be under the same control that they have.

The US Treasury Secretary, Janet Yellen, is also pushing for tighter regulation of digital assets. This week, he told a Senate banking panel that the current market tide illustrates the need for a proper regulatory framework.

Meanwhile, Hester Peirce expressed a more productive attitude by suggesting a “trial and error” approach. “There are different potential options for approaching stablecoins… and with experimentation, we need to make room for failure,” he said.