FED Researchers Have Published A Crypto Paper

A research team of the US Federal Reserve (FED) published a study on cryptocurrencies last week. Particular attention was paid to the stability of decentralized finance (Defi) and cryptocurrencies in the research.

The report first referred to the “strict control of cryptocurrencies” regulations brought forward by Lael Brainard.

In the report, it was stated that cryptocurrencies are still not regulated, so there are questions about liquidity, capital, and transparency

Researchers are quite uncomfortable with the connection of cryptocurrencies with traditional finance. They think that cryptocurrencies will further increase financial stability risks in the future.

Fed researchers have opened a separate parenthesis to the decentralized finance (Defi) sector. The report “Decentralized Finance (Defi): Transformative Potential and Associated Risks” provided a general commentary on the Defi industry.

Financial platforms built on public, decentralized blockchains emerged with the development of cryptocurrencies. Financial platforms, where the states have no news or even a rule, are a big problem for stability.

As cryptocurrencies continue to evolve, states are now seriously planning to regulate this area. However, it is still a big question mark how to regulate this area, which is completely independent of states, institutions, and censors.