Many stablecoins fall short of coming regulatory recommendations, says FSB chair

cointelegraph.com:

Financial Stability Board (FSB) chair Klaas Knot has outlined how the organization plans to address key threats to financial stability this year in a Feb. 20 letter sent to the G20’s Finance Ministers and Central Bank Governors. Crypto assets and decentralized finance (DeFi) had a prominent place on the list of challenges the FSB saw. The G20 ministers and bankers group is meeting Feb. 24-25 in Bengaluru, India.

The FSB has an “ambitious work programme” for finalizing a crypto asset regulatory framework in 2023, Knot said. The FSB is an advisory body created by the G20 and affiliated with the Bank of International Settlements (BIS). It has no enforcement powers.

The FSB indicated in a Feb. 16 report that it was increasing its attention to DeFi in light of its potential connections with traditional finance. Now, Knot, said, the recommendations in the emerging framework may bode ill for some stablecoins:

The guidance released by the BIS and International Organization of Securities Commissions in July extends the “same risk, same regulation” Principles for Financial Market Infrastructures to stablecoins. Those principles were released in 2012 in response to the 2008 financial crisis.

FSB provides overview on  Future Global Standards for  Stablecoins Key Takeaways:Stablecoins and other crypto assets are a growing focus for the Financial Stability Board (FSB).FSB chair stated, numerous stablecoins now in use wouldn’t comply with the global standards es… pic.twitter.com/EG4UM1fyhN

After the FSB published its final recommendations for regulatory and supervisory approaches to crypto assets and stablecoins in July, the board will make recommendations for specific standard-setting bodies and monitor their implementation. 

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