Circle’s Dante Disparte said bank failures in the US earlier this year helped to send investors into “unsafe, opaque” cryptocurrencies overseas, and called for the need for federal legislation around stablecoins, whose value is supposed to stay equal to the dollar.

“Candidly, should anyone anywhere be able to counterfeit US dollar using cryptographic methods or should there be a rule-set around competing with digital dollars on the internet where the safety and soundness and monetary policy of the United States is respected?” Disparte, the chief strategy officer at the second-largest stablecoin issuer, said during an interview Tuesday on Bloomberg Television.

The amount of Circle’s USD Coin in circulation has plunged to about $26 billion from $45 billion at the beginning of the year. British Virgin Islands-registered Tether, the biggest stablecoin, has grown during the same period.

The decline in USD Coin was triggered in part by the bank run on Silicon Valley Bank, where a portion of Circle’s deposits was trapped for several days before they were returned in full to the Boston-based company.

Both Circle and Tether are facing new competition, including from PayPal Holdings Inc., which recently announced its own stablecoin. Circle has a more than $1 billion cash cushion to help it deal with the competition as well as declining market share, the company said.

--With assistance from Kailey Leinz.