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Fed Vice Chair Brainard Says it is Time to Establish Crypto Regulation

Fed Vice-Chair Brainard said, “It is the time to establish regulations on crypto assets that continue to plummet, and sufficiently curb the spread to the financial system. He pointed out the need for cooperation between national and international authorities to tighten regulations, such as protecting investors and preventing money laundering.

The value of Bitcoin fell by about 60% from April to June against the backdrop of interest rate hikes by the US and European central banks. Brainard, who spoke at an event held by the Bank of England, harshly criticized the move as “exposing vulnerabilities.” He described stablecoins such as the cryptocurrency “Terra”, which could no longer be linked to the dollar, “reminiscent of the classic historic plunge.”

Cryptocurrencies are “not yet large enough to pose systemic risk and do not appear to be interconnected with traditional financial systems,” he said, hoping to create a regulatory framework before the impact becomes significant.

He pointed out that “having a central bank digital currency may be advantageous for future financial stability” because the risk of price plunge has become apparent in private virtual currencies. He showed a positive attitude toward the issuance of the “digital dollar” that the US government is conducting research on.

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