The chairmen of the ECB and the Fed have said during an online discussion organized by the Bank of France that it is necessary to strengthen the regulation of the decentralized finance (DeFi) sector against the backdrop of its development.
The head of the Fed, Jerome Powell, has said there are structural problems in the DeFi ecosystem. According to him, one of them is the lack of transparency.
He has added:
“The good news, I think, is that in terms of financial stability, the interaction between the DeFi ecosystem and the traditional banking system is not that great at the moment.”
However, Powell has warned this situation “will not continue indefinitely.” He has pointed to “a real need for more appropriate regulation” as the decentralized finance sector expands.