US Banks authorised to be validators of public Blockchains that create stable coin assets
Audited Stable stable coins like USDC have got more prominence now in the United States now with the country’s major regulator, the Office of the Comptroller of the Currency (OCC) allowing US banks to connect to the public blockchains as validators and use stable coins for making payment settlements just like SWIFT is used making for payment settlements.
This means US banks are authorised to be node operators of public blockchains that create stable coin assets like USDC with then having the permission to validate transactions, record and store them in the blockchain, referred by the OCC as node verification networks (INVN).
The Likely Stable coin candidate to be used for payment by banks is USDC
There are attempts to regulate stable coin assets further, with the Stable Act proposal lying on the table. Under this proposal, stable coin issuers will be required to procure a chartered banking license, with their audit records given to be scrutinised by the US’s Federal Reserve. This means that stable coins like tether, whose audit records are not clear, may not be an acceptable stable coin permitted to be used for settlement purposes elaborated above.
USDC, definitely gets good recognition through this as a trusted stable coin that would have no problem in getting the green light to be the settlement stable coin currency that can be used by US banks .
Stable Coin transaction infrastructure an alternative to SWIFT
This is great news of course, meaning that US customers can do USDC payments through banks overseas. This may be much required in the US because the old SWIFT system for transferring funds overseas takes too much time and fees.
Stable coins bring to relevance the Blockchain they get minted on - Ethereum
Indirectly, the Ethereum Network gets more prominence too as USDC stable coin that’s issued by Circle gets minted in the Ethereum Blockchain, with USDC being a ERC20 token.
However, let’s keep in mind that stable coins are not crypto, they are coins pegged to the US dollars, which is why they are approved by OCC to be used as payment settlement currencies.
We are well into a Blockchain Era now for sure!!
Decentralised currencies like BTC are the real cryptos, but in any case there is no doubt that this is a great win for Blockchain, as the Blockchain Era has already commenced, highlighting that the world is recognizing all the valuable things that Blockchain has to offer.