#StablecoinLaw
Stablecoin laws are emerging globally to address issues like fraud, money laundering, and financial system stability. Here's a breakdown of key regulatory developments:
Global Regulations
- The Financial Stability Board (FSB) has introduced high-level recommendations for regulating global stablecoin arrangements, focusing on comprehensive oversight, risk management, and cross-border cooperation.
- The G20 has initiated discussions on crypto asset regulation, emphasizing international cooperation ¹.
Regional Regulations
- *United States*: The Financial Innovation and Technology for the 21st Century Act provides a framework for oversight, with the SEC and CFTC regulating asset-backed tokens, and the Federal Reserve focusing on bank-issued stablecoins. Stablecoin issuers must maintain 1:1 reserve backing with detailed monthly audits.
- *European Union*: The Markets in Crypto-Assets (MiCA) Regulation emphasizes transparency and reserve requirements. Issuers must obtain licenses to operate within EU jurisdictions and maintain reserve assets equal to the circulating supply.
- *United Kingdom*: The Financial Services and Markets Act 2023 classifies stablecoins as "systemic payment instruments," with the FCA overseeing reserve backing and redemption rights.
- *Singapore*: The Payment Services Act emphasizes transparency and reserve requirements, with issuers required to maintain reserve assets equal to the circulating supply and undergo regular audits.
Key Requirements
- *Reserve Requirements*: Stablecoin issuers must maintain sufficient reserves to back their tokens, with some jurisdictions requiring 1:1 backing.
- *Audits and Transparency*: Regular audits and transparent reporting are crucial for stablecoin issuers to demonstrate compliance.
- *Licensing and Authorization*: Stablecoin issuers must obtain licenses or authorization to operate in various jurisdictions.
- *Anti-Money Laundering (AML) and Know-Your-Customer (KYC)*: Stablecoin issuers must comply with AML and KYC regulations to prevent illicit activities ² ¹.
