Key Takeaways
Yellen calls for stronger crypto oversight in FSOC’s final report before Trump’s term.
Trump’s pro-crypto appointments, including David Sacks as “Crypto Czar” and Scott Bessent as Treasury Secretary, signal a potential shift toward lighter regulation.
Treasury Secretary Janet Yellen has called for stronger oversight of crypto and stablecoins in the Financial Stability Oversight Council’s (FSOC) final report under the Biden administration, according to a Bloomberg report.
Yellen highlighted the growing risks these digital assets pose to the US financial system, stressing the urgent need for comprehensive regulation to address them.
“The council continues to call for legislation to create a comprehensive federal prudential framework for stablecoin issuers and for legislation on cryptoassets that addresses the risks we have identified,” Yellen said.
She noted that while digital asset innovations offer efficiencies, they also bring vulnerabilities, including cybersecurity threats and systemic risks.
Yellen, who has historically expressed skepticism toward digital assets, previously raised concerns about their use in illicit activities and threats to financial stability.
In 2021, she specifically highlighted the risks of illegal transactions facilitated through crypto.
The report comes as Yellen’s final contribution before Donald Trump takes office on January 20.
The incoming administration is expected to take a more favorable stance toward crypto, with Trump appointing former PayPal executive David Sacks as the “White House A.I. & Crypto Czar.”
Additionally, Trump has nominated hedge fund manager Scott Bessent as the new Treasury Secretary, set to succeed Yellen.