Editorial Board
Stablecoin Risks Grow as Congress Dithers
Policymakers should take action to protect investors, financial markets and national security.
Not stable enough.
Photographer: Tiffany Hagler-Geard/Bloomberg
Congress keeps talking about regulating stablecoins but doing nothing. It’s a lapse that poses growing dangers to investors, the financial system and even (perhaps) national security.
Don’t be fooled by the name: Stablecoins pose some of the greatest risks of any digital asset. The companies that issue the coins, led by Tether Holdings Ltd.’s USDT, offer the crypto equivalent of a dollar (or some other currency or reference asset). Instead of undergoing the huge price swings that seem normal in other digital assets, stablecoins are supposed to preserve their value.