Anonymous Message: The Financial Stability Board is currently deciding whether to conduct a review of stablecoins. It is expected to release stablecoin recommendations before December.

According to anonymous sources cited by Bloomberg, after weeks of discussions, the U.S. Department of the Treasury and relevant federal regulatory agencies are on the verge of deciding whether to initiate a review of stablecoins such as Tether through the Financial Stability Oversight Council (FSOC); meanwhile, the President's Working Group on Financial Markets (PWG) is also planning to release stablecoin recommendations by December.

Is Tether a Threat to Financial Stability?

Bloomberg cites three anonymous sources revealing that U.S. officials are considering whether to initiate a review of stablecoins such as Tether through the Financial Stability Oversight Council (FSOC), dealing another blow to stablecoins amidst ongoing regulatory rumors.

FSOC voting members include the Treasury Secretary, Federal Reserve Chair, SEC Chair, CFTC Chair, independent members, among others, with broad powers to assess and investigate any risks facing the U.S. financial system and designate any company or activity as a systemic threat to financial stability.

Additionally, the President's Working Group on Financial Markets, which previously held regulatory meetings on stablecoins, appears to be taking action.

Guidance on Stablecoins to Be Released

According to the sources, the President's Working Group (PWG) is also planning to release stablecoin recommendations by December, as regulatory agencies are reaching a consensus that "FSOC review action is imperative."

Members of both FSOC and PWG overlap, including Treasury Secretary Janet Yellen, Federal Reserve Chair Jerome Powell, and SEC Chair Gary Gensler.

Previously, Janet Yellen led the PWG in a stablecoin regulatory meeting held in July, where regulatory agencies viewed stablecoins as "unregulated money market mutual funds," warning that in the event of a cryptocurrency market crash, mutual funds could face investor runs and associated risks.

Furthermore, in December of last year, the President's Working Group stated that stablecoins may pose risks in terms of user rights, KYC, AML, market integrity, and currency stability.

Bloomberg notes that a Treasury spokesperson declined to comment on this news.