WASHINGTON—Randal Quarles, the former regulatory chief of the Federal Reserve, said on Thursday that U.S. regulators may “unnecessarily” hamper innovation around so-called stablecoins if they pursue recent recommendations put forward by a Biden administration working group.
Quarles, who will leave the Fed’s Board of Governors at the end of the month, said regulators must show “reasoned constraint” on monitoring stablecoins, which are digital currencies whose value are pegged to traditional assets like the dollar. He added that banks should be allowed to engage with them once certain concerns around transparency, stability and consumer protection are met.
