Basel Committee Proposes Stricter Rules for Stablecoins to Ensure Stability and Prevent Runs
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The Basel Committee proposed tightening criteria for stablecoins to get preferential risk treatment, ensuring they can meet redemption expectations.
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The criteria include short-term maturity, high credit quality, and low volatility of reserve assets.
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Stablecoins that don't meet the criteria would face highly conservative capital requirements.
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Reserve assets should also be protected from bankruptcy of parties involved in stablecoin operations.
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The consultation comes as organizations like S&P Global are looking at ways to assess stablecoin quality amid their rise in popularity.