Stablecoins in the Hot Seat as SEC Investigates Circle

The Breakdown

Nathaniel Whittemore

Investing, Business

4.8 • 786 Ratings

🗓️ 6 October 2021

⏱️ 16 minutes

🔗️ Recording | iTunes | RSS

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Summary

This episode is sponsored by NYDIG. On today’s episode, NLW homes in on recent reports surrounding the Biden administration's plans for stablecoins. A new report from the Wall Street Journal says there is a debate between using the Financial Stability Oversight Committee to add new rules for stablecoins and to regulate stablecoin issuers like banks. The crypto industry’s big question seems to be: Will crypto institutions be allowed to play, or will big banks shove them out? NYDIG, the institutional-grade platform for bitcoin, is making it possible for thousands of banks who have trusted relationships with hundreds of millions of customers, to offer Bitcoin. Learn more at NYDIG.com/NLW. Enjoying this content? SUBSCRIBE to the Podcast Apple: https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M= Join the discussion: https://discord.gg/VrKRrfKCz8 Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW “The Breakdown” is written, produced by and features NLW, with editing by Rob Mitchell and additional production support by Eleanor Pahl. Adam B. Levine is our executive producer and our theme music is “Countdown” by Neon Beach. The music you heard today behind our sponsor is “Only in Time” by Abloom. Image credit: kentoh/iStock/Getty Images Plus, modified by CoinDesk.

Transcript

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0:00.0	Welcome back to The Breakdown with me, NLW.
0:09.1	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:16.2	The breakdown is sponsored by Nidig and produced and distributed by CoinDes.
0:22.5	What's going on, guys? It is Tuesday, October 5th, and today we are talking about stable
0:27.9	coins in the hot seat. And let me just reiterate what I've said before about stable coins and
0:34.1	DFI. It seems very, very clear to me from all of the machinations of government,
0:40.9	the bluster of political opponents, that it is these assets, stablecoins specifically,
0:47.3	lending products built on stablecoins, defy, etc. that are going to arouse the greatest regulatory
0:53.0	ire in the months to come. That doesn't mean that
0:56.2	assets like Bitcoin and Ethereum won't get some scrutiny, but it seems very clear to me that in
1:01.8	particular these new novel areas of finance are likely going to be the big focus. Now, for our
1:08.7	specific discussion today, I want to go back to earlier comments from
1:12.5	Elizabeth Warren. Speaking to Bloomberg at the beginning of August, she said regarding
1:17.6	crypto and stable coins, the bigger it gets and the more it stays outside the financial
1:22.1	system, something goes wrong. There's a run on crypto, there's a problem elsewhere in the
1:26.0	economy. I don't want the
1:28.2	U.S. taxpayer to be the one that gets called on to back this up. In other words, Warren is saying,
1:35.1	I don't want to have to bail out crypto. It needs to be said right up front that this logic is
1:40.5	truly absurd. Crypto is the most volatile industry in the world. We routinely see massive,
1:46.8	gut-wrenching drops. Sometimes those drops just continue for months, if not years at a time.
1:52.9	People get washed out regularly, liquidated entirely, forced to go back to square one,
1:58.4	and no one asks for a bailout.
	...

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