ARLINGTON, Va.—Credit union should not be excluded and NCUA should not be put in an untenable position as the federal government tackles regulations around stablecoins, according to NAFCU President and CEO Dan Berger.
In a letter to Treasury Secretary Janet Yellen on the President’s Working Group on Financial Markets’ (PWG) Report on stablecoins, of which credit unions are not a part, Berger said the exclusion risks continuing the uneven regulatory landscape between credit unions and other financial institutions while also putting NCUA at a disadvantage.
"We urge the PWG to clarify that credit unions, as insured depository institutions, have parity with banks with respect to the recommendations made in the Report and ask that all members of the PWG support the NCUA’s inclusion in ongoing and future PWG efforts," wrote Berger.
Call for Legislation
Berger noted the report recommends that Congress enact legislation requiring all payment stablecoin issuers to be “insured depository institutions” – citing the narrow definition from the Federal Deposit Insurance Act. This definition risks legislators interpreting the report recommending that Congress enact legislation requiring a stablecoin issuer to obtain a bank charter – not either a bank or credit union charter.
"The NCUA protects the financial wellbeing of over 127 million Americans by providing this country’s credit union members with federal share insurance that matches the Federal Deposit Insurance Corporation’s protections dollar for dollar," wrote Berger. "If credit unions are wholly excluded from participating in these and similar innovations, credit unions and their members will be needlessly harmed, and the NCUA will be handicapped in its charge to ensure the safety and soundness of an important, irreplaceable sector of the financial system."