Top US-based crypto exchange Coinbase is responding to the Financial Stability Board (FSB) regarding its proposal to internationally regulate crypto assets, which the regulator is set to reveal in the coming months.
Penned by Coinbase’s chief policy officer Faryar Shirzad, the exchange identifies several key areas that it says should be considered in any global regulatory framework.
Coinbase names stablecoins as the foundation for a “new era of innovation in financial services.” However, Shirzad writes that Coinbase has some issues with the FSB’s perspective on stablecoins.
“We are concerned, however, about the breadth of the FSB’s use of the term ‘stablecoin arrangement.’ As used in the Reports, this term captures a wide range of activities, many of which are well outside the typical purview of financial market infrastructures, such as validating transactions on a blockchain network. We recommend that the FSB should clearly exclude from the scope of a ‘stablecoin arrangement’ any validators, block builders, relays, pool operators, and other blockchain technology infrastructure providers who have no involvement of any kind in a stablecoin arrangement other than to support the blockchain network on which a stablecoin may operate.”
Coinbase also covers the importance of decentralized finance (DeFi) and recommends that the FSB look to promote innovation in the sector rather attempt to stifle it altogether.
“Governments and regulators encouraged the internet’s early development, and they should likewise encourage DeFi innovation at the base layer to flourish. DeFi developers only develop and publish code; they do not directly facilitate financial transactions for customers or hold their assets, and we believe it would be inappropriate to regulate developers as if they were cryptoasset market intermediaries.”
You can read Coinbase’s full response here.
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