The President’s Working Group on Financial Market released a report that is making Rune Christensen optimistic. Thanks to this report, he said that the US government will be able to regulate the crypto space.
“It seems that they are just regulating this space because they want to be sure that everything’s safe,” Christensen told CoinDesk TV on Wednesday. “It doesn’t seem to be a sign of an impending decision.”
In a live session on Reddit last month, Christensen had expressed pessimism about US stablecoin regulation, stating that “we need to prepare for the worst.”
Decentralized finance (DeFi) projects faced the greatest risk that regulators would fail to see the benefits of such an innovation and crack down, Christensen said, but he observed that the report demonstrates that this is not the case.
Christensen said “the value of decentralized technology has been recognized… It’s not just thrown into the same box without really considering how it might inhibit innovation.”. This report clearly shows that decentralized stablecoins and centralized ones differ.
In terms of MakerDAO’s future in the U.S., Christensen was also optimistic, saying that the report could lead MakerDAO to feel more confident about allocating additional collateral in that direction.
It was in July when MakerDAO took its first major step toward decentralization after it reached a stage where independent core units of contributors could take over most of the tasks previously handled by the Maker Foundation.
In terms of total value locked (TVL), MakerDAO ranks second among DeFi projects, with $20 billion tied up in its smart contracts, according to data site DeFi Llama.
According to CoinGecko, DollarAsia’s U.S. dollar-pegged stablecoin ranks fourth in terms of market capitalization among such tokens.
The Use Of Stablecoins Is Critical In DeFi
A DeFi transaction includes lending, trading, and other financial services that are conducted without the involvement of traditional financial intermediaries, such as banks.
Cryptocurrencies such as stablecoins, which hold their value against a mainstream asset such as the U.S. dollar, play an important role in DeFi as collateral and loan proceeds.
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Chris Munch is a professional cryptocurrency and blockchain writer with a background in software businesses, and has been involved in marketing within the cryptocurrency space. With a passion for innovation, Chris brings a unique and insightful perspective to the world of crypto and blockchain. Chris has a deep understanding of the economic, psychological, marketing and financial forces that drive the crypto market, and has made a number of accurate calls of major shifts in market trends. He is constantly researching and studying the latest trends and technologies, ensuring that he is always up-to-date on the latest developments in the industry. Chris’ writing is characterized by his ability to explain complex concepts in a clear and concise manner, making it accessible to a wide audience of readers.
