Read the article: 2 minutes The Netherlands are calling for stricter regulation for so-called stablecoins. These are cryptocurrencies or tokens, the units of which represent the equivalent of a state currency on the blockchain. The finance ministers of the five countries are calling for a strict ban in all member states. At least until all questions of regulation and supervision have been clarified. This would not only affect stablecoins such as Libra, but also solutions that are already on the market. This also includes the market leader Tether and its top product USDT. The demands were part of the outcome of the informal meeting of finance ministers of the EU member states in Berlin.
Stablecoins only under strict conditions
On the one hand, one would like to counter potential threats that could overturn state control over the euro, which were suddenly raised by the initiative of Libra. On the other hand, it is also about consumer protection measures, such as ensuring that existing stablecoins are covered in a ratio of 1: 1. In addition, the issuers of the stablecoins are supposed to make the corresponding deposits in specially designated accounts, to ensure that consumers and companies can claim the equivalent value in case of doubt and that their claim does not come to nothing. In addition, this should prevent new money from being indirectly spent through uncovered stablecoins.
The market has a need
Although many of the statements were made primarily to put Libra in its place, existing stablecoins also sometimes create a problematic market environment. In court proceedings, Tether had to admit that only 74 percent of its own stablecoins were covered. The lawyers’ calculations also included crypto currencies and other assets, which runs counter to the idea of stablecoins, as these assets themselves are subject to fluctuations in value and are highly speculative Unlike cryptocurrencies, stablecoins want to operate in a regulated and manageable environment. After all, they are primarily issued by companies that have a certain interest in them and ultimately consumers want to be sure that the value is really stable.