FDIC Considers Tokenized Deposit Insurance, Stablecoin Applications Coinstar

The acting chairman of the Federal Deposit Insurance Corporation (FDIC), the regulatory body that oversees US banks, is reportedly considering guidelines for tokenized deposit insurance and plans to launch an application process for stablecoins by the end of the year.

Acting FDIC Chairman Travis Hill, who is made bullish statements about tokenization in the past, told the Federal Reserve Bank of Philadelphia’s Fintech Conference on Thursday that the regulator will eventually release guidance on tokenized deposit insurance, according to reports.

The FDIC protects depositors in the event of a bank failure and insures money in bank accounts insured by the regulator.

“I have long held that a deposit is a deposit. Moving a deposit from the world of traditional finance to a blockchain or distributed ledger world should not change its legal nature,” said Hill, as reported by Bloomberg.

Great interest in tokenization

Regulators and Wall Street have shown serious interest in the real-world asset (RWA) tokenization sector this year.

Excluding stablecoins, the total value of real-world tokenized assets topped $24 billion in the first half of the year, with private credit and US government bonds making up the bulk of the market, according to a RedStone report.