With the latest banking crisis top of mind, Circle’s policy lead is hoping to use his new advisory role on a new CFTC committee to effect change.
The Commodity Futures Trading Commission (CFTC) announced a newly constituted tech committee this week to educate the government on emerging technologies like crypto and artificial intelligence.
Along with ten other crypto-centric members, Circle’s global policy VP Corey Then will also be part of the Technical Advisory Committee (TAC).
Circle issues the market’s second-largest stablecoin by market capitalization USDC. The stablecoin briefly lost its dollar peg after it was revealed the firm had custodied $3.3 billion of its reserves with the now-defunct Silicon Valley Bank (SVB).
Then lauded the CFTC’s “collaborative approach,” telling Decrypt that he’ll seek more inclusive regulatory policies for stablecoin issuers by advocating direct deposit of funds at the Federal Reserve to eliminate “bank counterparty risk.”
Then outlined a series of redemption, reserves, and disclosure standards that, if met by issuers, would allow them access to the Fed.
Circle’s policy lead told Decrypt that the recent banking chaos in the U.S. was a “reminder that fractional-reserve banking, while critical for credit creation, also requires confidence in the system. Some banks are holding assets that are worth less today than when they were purchased due to rapidly rising interest rates.“
“Circle can play an important role in making the global financial system safer and more resilient, and we look forward to engaging with the TAC on this important endeavor,” he said.
Prominent entities which sent their representatives to the committee include TRM Labs, Fireblocks, Paradigm, Circle, and Ava Labs, among others.
“There has been a Cambrian explosion of innovation in our financial markets over the last decade,” Paradigm’s policy director Justin Slaughter told Decrypt. “The CFTC is at the center of those developments, from the rise of algorithmic trading and AI-assisted tools to crypto.”
The committee was first formed in 1999 to address the impact and implications of technological innovations. It guides the Commodity Futures Trading Commission (CFTC) and other federal agencies on emerging technologies. The government body is usually renewed every two years.
The committee plans to hold its first meeting since December 2020 on March 22, 2023.
Stay on top of crypto news, get daily updates in your inbox.