U.S SEC, OCC issue first regulatory guidance for stablecoins
U.S Securities and Exchange Commission (SEC) and the Office of the Comptroller of the Currency (OCC) issued a stablecoin guidance on Monday for U.S national banks and federal savings associations to hold stablecoin reserves. This would be the first detailed national guidance on how cryptocurrencies backed by fiat currencies, with the dollar in particular, should be treated under federal securities law.
According to a letter published by the OCC and signed by OCC Chief Jonathan V. Gould, there were risks of banking any stablecoin issuers. However, the letter detailed how banks could maintain stablecoin reserves better which according to the OCC Chief were an increasingly popular digital asset.
The letter also said how stablecoin issuers can earn the trust of their potential customers with regard to the safety of their products once regulated banks held their stablecoin reserves. In addition to this, the letter clarified that the guidance was meant for stablecoins held in hosted wallets that are controlled by a trusted third party.
In an announcement of its own, the U.S. Securities and Exchange Commission (SEC) cited the OCC Chief’s letter and stated that certain stablecoins were not securities under federal law and advised stablecoin issuers to work with the SEC to ensure the same.
According to the new announcement, the SEC was ready to provide a “no-action” letter, to stablecoin issuers to ensure the firms do not invoke federal law enforcement action. The SEC said in the announcement:
Whether […] stablecoin is a security under the federal securities laws is inherently a facts and circumstances determination. This determination requires a careful analysis of the nature of the instrument, including the rights it purports to convey, and how it is offered and sold.