The Financial Stability Board (FSB) has published its finalised high-level recommendations for the regulation, supervision and oversight of “global stablecoin” (GSC) arrangements. The report says that GSC arrangements are expected to comply with all regulatory standards and to address risks to financial stability before commencing operation. The arrangements will also adapt to new regulatory requirements as necessary.
“Stablecoins” are a specific category of crypto-asset which have the potential to enhance the efficiency of payments and promote financial inclusion, but which may also pose risks to financial stability, especially if they are adopted at a significant scale. The FSB’s recommendations call for regulation, supervision and oversight that is proportionate to those risks.
The performance of some functions of a GSC arrangement may also have important impacts across borders. The report therefore stresses the value of flexible, efficient, inclusive, and multi-sectoral cross-border cooperation, coordination, and information sharing arrangements among authorities.
As a key building block to the G20 commissioned roadmap to enhance cross-border payments, the FSB has agreed to the following further actions:
- Completion of international standard-setting work by December 2021;
- Establishment/ adjustment of cooperation arrangements among authorities by December 2021 (and as needed based on market evolution);
- At a national level, establishment/ adjustment of regulatory, supervisory and oversight frameworks consistent with FSB recommendations and international standards and guidance by July 2022 (and as needed based on market evolution); and
- Review of implementation and assessment of the need to refine or adapt international standards by July 2023.