WASHINGTON, Nov 1 (Reuters) - A U.S. Treasury Department-led panel is set on Monday to release a hotly-awaited report on stablecoins, a fast-growing type of digital coin pegged to traditional currencies, according to an administration official with knowledge of the matter. The report by the President’s Working Group on Financial Markets will explore the risks and opportunities offered by stablecoins, a roughly $131 billion market, paving the way for future regulatory and potential congressional action. Policymakers worry the boom in privately-operated cryptocurrencies could undermine their control of the financial and monetary systems, increase risks, promote financial crime, and hurt investors. It remains unclear, however, which financial rules and agencies apply to these relatively new products. Treasury Secretary Janet Yellen has said the government must quickly establish a regulatory framework for stablecoins, and Monday’s report is expected to help provide a blueprint as well as assert which regulators may already have jurisdiction. “In terms of the substance of the report, we expect a fair framing of the benefits (e.g., faster/cheaper payments, financial inclusion) with potential drawbacks (e.g., risk of runs leading to fire sales of reserve assets) as well as a number of policy recommendations,” Isaac Boltansky, director of policy research for brokerage BTIG, wrote in a note The President"s Working Group (PWG) has been researching stablecoins for the past few months, including through meetings with a range of financial industry participants, consumer groups and members of Congress, Reuters reported here in September. Those discussions covered the potential uses of stablecoins for payments, their risks to users, and the financial system and whether some stablecoins would merit direct oversight. They also explored how regulators should try to mitigate the risks of too many people trying to cash in their stablecoins at the same time, and whether major stablecoins should be backed by traditional assets. The PWG traditionally includes the Treasury, Federal Reserve, Securities and Exchange Commission and the Commodity Futures Trading Commission, but the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency are also involved. Traditional financial firms have called for stiffer rules for cryptoassets, which threaten their businesses, but have also said policymakers should allow responsible innovation. “The payments industry values predictability and legal certainty. As such, we are looking for the PWG to recommend a regulatory framework that achieves these two goals, while still encouraging continued innovation and protecting consumers,” said Scott Talbott, a senior vice president at the Electronic Transactions Association in Washington. (Reporting by Pete Schroeder and Michelle Price Editing by Paul Simao)