SEC Commissioner Hester Peirce.

Crypto regulation should leave room for innovation to flourish or fail, said SEC Commissioner Hester Peirce.
She also spoke about stablecoins that were in focus as the price of US-dollar pegged TerraUSD coin plunged. 
The crypto proponent said variations in the market make it “difficult” to craft a regulatory framework. 

The growing cryptocurrency market needs regulatory support to allow innovation to flourish and to flop, and the spotlight thrown on stablecoins during this week’s plunge of  TerraUSD highlights the need to be mindful of variations in digital assets, Securities and Exchange Commission member Hester Peirce said Thursday. 

Peirce, known as a crypto proponent, said during a virtual forum that investors may see some “movement” in Washington around stablecoins, which have already caught the eye of regulators in part because of their pegs to the US dollar. 

The crypto market this week has focused on algorithmic stablecoins whose values are derived by a combination of computer codes and reserves to maintain a peg. That focus was sparked by the price meltdown of algorithmic stablecoin TerraUSD below $1 and the slide of its sister coin luna to a $0 value. Algorithmic stablecoins differ from so-called traditional stablecoins such as Tether which are also pegged to a fiat currency but backed by hard assets such as cash, government bonds or commodities. 

“[There’s] a lot of use of stablecoins and therefore people are thinking down the road, ‘If this gets even bigger do we want to have some kind of a regulatory framework?’,” said Peirce during a panel discussion held by the Official Monetary and Financial Institutions Forum. The OMFIF is an independent think tank centered on central banking, economic policy and public investment.

“As with anything in crypto, I think it’s very important to remember that one term can …read more

Source:: Business Insider


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