Janet Yellen Sounds Alarm on Crypto Risks, Urges Vigilance

Crypto News– U.S. Treasury Secretary Janet Yellen is slated to address Congress, highlighting several potential risks posed by the crypto industry to the financial system. These risks include the instability of stablecoins, the potential for runs on crypto platforms, and the volatility of prices, as revealed in a brief excerpt from her testimony shared on Monday.

Janet Yellen Sounds Alarm on Crypto Risks, Urges Vigilance

Yellen is scheduled to appear before the House Financial Services Committee on Tuesday to discuss the recent efforts of the Financial Stability Oversight Council (FSOC), a group she leads composed of heads of various U.S. financial agencies. The council, tasked with proactively addressing potential financial crises, has prioritized monitoring crypto risks in recent years, identifying them as among the top concerns.

In her prepared testimony, posted on the committee’s website, Yellen emphasized the FSOC’s focus on digital assets and associated risks. These include the possibility of runs on crypto-asset platforms, concerns over stablecoin vulnerabilities, the volatility of crypto-asset prices, and the proliferation of platforms operating outside of or in non-compliance with existing laws and regulations.

Yellen reiterated her commitment to collaborating with Congress on crypto-related legislation. She stressed the importance of enforcing applicable rules and regulations while advocating for the passage of legislation to regulate stablecoins and the spot market for crypto-assets not classified as securities.