US credit union regulator seeks industry input on decentralized finance and stablecoins

The U.S. National Credit Union Administration's governing board approved Thursday a request for information (RFI) that seeks to learn more from the credit union industry about their views and positions on digital assets, with a significant focus on decentralized finance or DeFi.

The RFI notice invokes the topic of DeFi repeatedly, as well as digital assets more broadly. One question honed in on the subject of stablecoins, asking participants, "[a]re there distinctions or similarities between stablecoins...and stored value products where the underlying funds are held at FICUs and, for which pass-through share insurance may be available to members in limited scenarios?"

In a broader sense, the RFI indicates that some of the leading areas of development in the crypto space are being scrutinized by the top regulator for credit unions in the U.S. The intersection of digital assets and banking has drawn the attention of other American regulators as well, including the Office of the Comptroller of the Currency (OCC). Regulators worldwide have recently honed in on aspects of the crypto space, from stablecoins to exchanges to crypto-tied financial products, as areas for tighter regulation. 

"The NCUA is publishing this request for information with the aim of engaging the broad credit union industry and other stakeholders and learning how emerging DLT and DeFi applications are viewed and used," the document notes. "The NCUA hopes to learn how the credit union community is using these emerging technologies and gain additional feedback as to the role the NCUA can play in safeguarding the financial system and consumers in the context of these emerging technologies."