U.S. Banking Attorney Advocates for Bank-Level Stablecoin Regulations
Randy Guynn,a leading U.S. banking lawyer, believes stablecoins should face bank-level regulations. He made this point during a U.S. House Financial Services Committee meeting.
Guynn argues that stablecoins should match the safety of insured bank deposits and central bank money. He suggests that stablecoin issuers should maintain liquidity reserves and capital buffers similar to banks.
“With the right reserve of liquid assets and capital buffer, stablecoins can be as secure as bank deposits,” Guynn stated. He sees stablecoins as digital private money and believes they should be regulated as such.
Guynn, who leads the Financial Institutions Group at Davis Polk & Wardwell LLP, notes that private money has historically been part of financial systems. However, he warns that without proper oversight, stablecoins could cause financial instability, similar to past banking crises.
GuynnS testimony comes as discussions on the Stablecoin Regulation Act continue.This bill aims to set clear rules for stablecoin issuers. Guynn, who helped design Meta’s Diem stablecoin project, believes well-regulated stablecoins can improve payment efficiency and reduce risks.
His views add to the ongoing debate about whether stablecoins should be regulated like banks, money market funds, or as a new financial category.
