In many respects, these effects may be similar to dollarization aside from the fast pace and wide scope of adoption. The Work Ahead The emergence of cryptocurrencies—and particularly stablecoins—has raised important questions for central banks and other authorities, including on the appropriate regulatory framework. In the United States, the regulatory framework for cryptocurrencies is not straightforward.
Our current framework is based largely on whether a cryptocurrency is deemed to be a security or has associated derivative financial products and whether the participating institutions have a supervisory agency overseeing their activities. Unlike many other jurisdictions, regulators do not have plenary authority over retail payments in the United States. Moreover, the regulatory challenges are likely to be inherently cross-border in nature.