Michael Barr, vice chairman for supervision at the US Federal Reserve, commented on issues related to stablecoins and CBDCs on November 7.
According to reports from Bloomberg, Barr said:
“There is interest in strong, federal regulation of stablecoins that ensures the Federal Reserve can approve, regulate, and enforce stablecoin issuers, including wallets.”
Barr said the US needs a “strong framework” for stablecoins, but suggested it is not the Federal Reserve’s job to make those rules. Instead, he said it is “better if Congress can set the rules of the road.” However, reports from August suggest that Republican lawmakers are opposed to some stablecoin rules proposed by the Fed.
Other reports from Fortune indicate that Barr commented directly on central bank digital currencies (CBDCs), or dollar-pegged digital assets issued by the government.
Barr said the Federal Reserve has not yet decided whether issuing such a CBDC would be a good idea or not – in line with his previous statements.
That statement is also consistent with the Federal Reserve’s official FAQ page, which states that it has not yet made a decision on whether to establish a CBDC. It also confirms that congressional approval would be required to issue such an asset.
Barr took over the Fed’s role in early 2022
Barr assumed his current role after the Biden administration announced his appointment in April 2022. He has previously commented on other matters related to cryptocurrency.
In March 2023, the Federal Reserve said Barr would lead a review of its own oversight of failed crypto-friendly bank, Silicon Valley Bank. Later, Barr suggested that the bank’s failure was partly due to contagion within the U.S. banking system, while also discussing the Federal Reserve’s role in predicting bank failures.
In October 2022, Barr advised banks dealing with crypto deposits to be aware of the increased liquidity risks and told banks to be cautious when servicing crypto companies.
In the post where the Federal Reserve’s Michael Barr comments on stablecoin regulations, CBDCs first appeared on CryptoSlate.