Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge. When he's not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
At a recent Congressional hearing, Jamie Dimon expressed support for proper regulation of stablecoins while castigating other crypto assets.
According to JPMorgan chief executive Jamie Dimon, stablecoins should see better regulation. At a congressional hearing on Wednesday, Dimon revealed that he is open to a proper regulatory structure for digital currencies. However, in the same breath, the JPMorgan CEO was scathing in his assessment of cryptocurrencies. An avowed crypto skeptic, Dimon described decentralized digital currencies, such as Bitcoin (BTC), as “decentralized Ponzi schemes”. His latest comments on stablecoin regulation and crypto follow fresh reports that lawmakers on the House Financial Services Committee are looking to propose a new stablecoin bill draft.
Jamie Dimon gave his opinion on the regulation of stablecoins before the House Financial Services Committee in Washington. As part of his testimony, the JPMorgan chief executive officer said:
“There’d be nothing wrong with a stablecoin properly – just like a money market fund – properly regulated. You have some today and they are not.”
“I’m a major skeptic on crypto tokens, what you call a currency, like Bitcoin. They are decentralized Ponzi schemes. And the notion that it’s good for anybody is unbelievable. It’s dangerous,” stated Dimon.
In addition to Dimon, several prominent bank CEOs also testified on related matters throughout the day.
More on Jamie Dimon Pushing for Regulation for Stablecoins
During Dimon’s testimony, Rep. Josh Gottheimer quizzed the JPMorgan boss with a series of pertinent questions. Specifics include factors affecting Dimon’s crypto stance, and whether he has concerns about the country’s slow approach to crypto adoption. Furthermore, the New Jersey lawmaker also referred to his own bill seeking a proper structure for stablecoin regulation.
Speaking on the proposed stablecoin bill that would temporarily ban the types of payment coins not backed by outside assets, Dimon explained:
“It’s equivalent to a money market fund, you should look at it exactly the same way in terms of disclosure, backup, gates and a whole bunch of different things.”
Meanwhile, Wells Fargo & Company CEO Charles Scharf also touched on Gottheimer’s bill, among other things. According to Scharf, the proposed stablecoin bill is a valid option to ensure that people “understand the underlying value of that stablecoin.”
Stablecoin Draft Bill
Media reports state that a draft bill that would create a two-year ban on stablecoins not fully backed by highly liquid assets was under negotiation. According to the reports, the proposed bill also seeks to create a two-year grace period for these non-backed assets. This period will allow them to change their business model and subsequently receive approval.
Negotiation proceedings took place between House Financial Services Committee Chair Maxine Waters and the committee’s top Republican, Rep. Patrick McHenry.
Pursuant to the bill’s broader development, the Federal Reserve would also receive the mandate to study the economic impact of a US digital dollar. This process, handled by the US central bank, is already underway.