The Biden administration is reportedly considering a new legal framework for stablecoin issuers that would put them in the same category as banks, raising questions about the time to come of crypto regulation in the country.

Citing people familiar with the affair, The Wall Street Journal reported Fri that the administration is looking to convince Congress to create a new "special-purpose charter" for stablecoin issuers and other companies that fall within the aforementioned category. Although it'southward not entirely clear how the legislation will wait, information technology's expected to be tailored specifically to these types of business models.

Policymakers have been sounding the alarm over stablecoins in recent months because they believe these dollar-pegged assets aren't properly regulated. Earlier this week, Federal Reserve Chairman Jerome Powell told the Financial Services Committee that stablecoins like Tether (USDT) and USDC Money (USDC) should exist regulated within the aforementioned parameters every bit money market place funds like banking company deposits. Notwithstanding, he remained steadfast in stating that no blanket ban on Bitcoin (BTC) or other digital assets was in the cards.

As Cointelegraph reported in July, joint enquiry past the Fed and Yale University outlined two regulatory frameworks for stablecoins in a 49-page paper called, "Taming Wildcat Stablecoins." In that paper, the authors argued that policymakers have only two choices with respect to stablecoin regulations: make them equivalent to public money or taxation them out of being via central bank digital currency.

Related: US Treasury reportedly in talks for stablecoin regulation

Stablecoins — digital currencies that are wholly or in part pegged to a class of fiat money like the U.S. dollar — take swelled to get a $128 billion market, according to the latest marketplace capitalization figures. Tether accounts for over half of the total marketplace, though competitors such every bit USDC and Binance USD (BUSD) accept made meaning headway this year. As these markets have grown, concerns over the liquidity and reserve status of stablecoin issuers have made eye-grabbing headlines.

After reaching a settlement with the Role of the New York Attorney General, Tether Holdings Ltd. agreed to publish periodic reports proving its currency reserves. In May of this year, the company disclosed its full reserve breakdown for the first time.