U.S. Treasury Secretary Yellen plans to loosen financial regulations? FSOC makes a major turn in direction

[BlockBeats] On December 11, a major news broke—U.S. Treasury Secretary Yellen is preparing for a major overhaul of financial regulation. The new Treasury Secretary aims to reshape the operational logic of the Financial Stability Oversight Council (FSOC), with a core focus on two words: relaxation.

According to Yellen’s letter on Thursday, the council will next assess the existing regulatory framework together with member agencies to identify rules that constitute “excessive burden,” and whether these rules are hindering economic growth or threatening financial stability. This sounds quite counterintuitive—traditionally, regulation is meant to prevent risks. But Yellen’s logic is: overregulation might be counterproductive.

It’s important to note that FSOC itself was created as a result of the 2008 financial crisis, with the initial purpose of monitoring systemic risks. Now that the chair has changed, the direction is also shifting. From “tightening” to “relaxing,” this is a significant turn.

Additionally, Yellen plans to establish an AI working group to explore how artificial intelligence can enhance the resilience of the financial system, while also guarding against new risks AI might bring. This move is quite in line with current trends—after all, the intersection of AI and finance is both an opportunity and a minefield. For the cryptocurrency and Web3 industry, signals of regulatory easing are worth paying attention to, as they could influence policy environments in the coming years.