Clarified 11:08 a.m. | Firms that issue or trade stablecoins are looking to secure banking licenses, largely as a signal to customers that the coins are safe as bank deposits.
It’s a new development in the world of cryptocurrency, which hasn’t enjoyed the best reputation for investor protection. And the companies are doing it without waiting to see whether Congress will follow a recommendation to require it.
The President’s Working Group on Financial Markets, a group of regulators, in November recommended legislation to require stablecoin issuers to be insured depository institutions — banks whose deposits are covered by the Federal Deposit Insurance Corporation and therefore subject to bank rules. That would protect depositors’ money in case the bank fails.
