FSB urges stronger coordination on stablecoin risks
- The Financial Stability Board (FSB) is calling for stronger cross-border cooperation to monitor risks linked to global stablecoin arrangements.
- Stablecoins had a combined market value of about US$300 billion by mid-2026, with 99% pegged to the US dollar.
- The FSB highlights gaps in information sharing, reserve monitoring and crisis preparedness that could complicate responses to stablecoin failures.
The Financial Stability Board (FSB) is urging regulators to improve cross-border information sharing and prepare for potential disruptions involving global stablecoin arrangements.
Stablecoins had a combined market value of about US$300 billion by mid-2026, with approximately 99% pegged to the US dollar.
The FSB’s report identifies weaknesses in international monitoring and crisis planning that could hinder authorities responding to a stablecoin issuer’s distress or failure.
A sudden loss of confidence could trigger redemptions, force reserve-asset sales and disrupt bank deposits, payment systems and foreign exchange markets.
The report also highlights risks when related issuers share liabilities but maintain separate reserves that may prove difficult to transfer during market stress.
Differences between national regulatory frameworks could further complicate oversight and encourage issuers to operate in jurisdictions with less stringent requirements.
The FSB recommends improving data quality and monitoring reserve locations, redemption flows, market liquidity and geographic exposures to strengthen cross-border risk assessment.
The recommendations seek to improve authorities’ ability to identify vulnerabilities and coordinate responses as stablecoins become more connected to the wider financial system.
