Banking-style accountability could ‘stifle’ stablecoins without further changes
The digital asset industry has warned Treasury it is overestimating startups’ ability to comply with a regime designed for banks and super funds.
Plans to bring stablecoin issuers under the country’s “heavy-handed” financial accountability regime (FAR) will stifle the sector before it gets off the ground, according to the fintech sector and crypto exchanges.
The current proposal would introduce additional disclosure and reporting obligations once local stablecoin issuers start managing $200 million worth of client funds. But at that level “the compliance burden is unworkable”, a spokesperson for crypto exchange Coinbase told Capital Brief.
There is widespread support for tailored regulation of stablecoin issuance, which is considered essential for attracting the support of major banks and capitalising on the transaction cost saving promises of the technology.
Treasury officially wrapped up a round of consultation on the regulation of payment services providers last Friday.
