Source: Blockchain Knight

Fed Chairman Jerome Powell reiteratesThere is a need to establish a regulatory framework for stablecoins and it says the Fed has no intention to limit the interaction between the banking industry and the Crypto industry.

On April 16, Powell said in a speech at the Chicago Economic Club that both houses of the U.S. Congress are working to re-work for legislation for the stablecoin framework. He believes that given the increasing importance of these digital tools, it is necessary to establish a regulatory framework.

Powell mentioned that the previous efforts of the Federal Reserve and Congress to cooperate on the stablecoin legal framework have not been successful. However, he noted that “the situation is changing” and lawmakers are now showing new interest in formalizing regulatory provisions.

He stressed that such a framework should include consumer protection measures and ensure transparency, adding: “Stablecoins are digital products that may actually have quite broad appeal.”

Relax regulatory regulations

Powell also talked about the Fed's position on Crypto-related banking activities. He acknowledged that U.S. bank regulators, including the Federal Reserve, have taken a conservative approach to publishing guidance on how banks should manage their exposure to digital assets.

However, he saidAs long as consumer protection and financial security are guaranteed, some of these guidance may be relaxed to accommodate responsible innovation。

"We will try to adjust in a way that keeps the financial system safe and sound," he said.

The remarks are further elaboration of Powell's previous statement that the Fed has no intention to prevent banks from serving legitimate Crypto customers.

Earlier this year, Powell made it clear in his testimony to Congress that under the established regulatory framework, Crypto activities have been carried out within the Federal Reserve-regulated banks.

He used Crypto custody as an example to illustrate that such services can be safely carried out if banks and regulators understand the scope of these activities.

Powell also acknowledged that the regulatory work of integrating digital assets into traditional finance is very complex and called for a more comprehensive regulatory structure.

Crypto Assets and Banking

In a press conference after the Federal Open Market Committee (FOMC) meeting in February, Powell said that while the threshold for banks to participate in Crypto business remains high, the Fed does not intend to cut off banking services from legally operated digital asset companies.

Discussions surrounding stablecoin legislation continue, while stablecoin use in payments and digital settlement continues to grow. Last year, the amount of stablecoins transferred close to $14 trillion, surpassing Visa.

Powell's statement shows that the Fed supports Congress' efforts to create formal rules for stablecoins, provided that such legislation balances innovation and risk control.

There is currently no federal regulatory system specifically for stablecoins, but several legislative proposals have been proposed in recent sessions of Congress. The most notable of these are the GENIUS Act and the STABLE Act, which were proposed by the House and Congress respectively.

The latest position of the Federal Reserve shows thatAs stablecoins become increasingly integrated into global financial markets, U.S. financial authorities are increasingly willing to participate in the formulation of digital asset policies。