On 14 April 2020, the Financial Stability Board (FSB) published a consultation paper proposing 10 high-level recommendations that are addressed to national authorities to advance consistent and effective regulation and supervision of global stablecoin (GSC) arrangements. The consultation paper also highlights key international regulatory standards from the Basel Committee, FATF, CPMI and IOSCO that could apply to GSCs.
The recommendations focus on financial regulatory and supervisory issues relating to privately-issued GSCs predominately intended for retail use. Wider issues such as monetary policy, monetary sovereignty, currency substitution, data privacy, competition, and taxation issues are beyond scope.
The proposed recommendations are motivated by GSCs predominantly intended for retail purposes that may pose financial stability risks, but could also apply to stablecoins or other crypto-assets that pose similar risks. The recommendations seek to address the particular governance challenges of a GSC arrangement. They call for regulation, supervision and oversight that are proportionate to the risks, and stress the need for flexible, efficient, inclusive and multi-sectoral cross-border cooperation, coordination and information sharing arrangements that take into account the evolution of GSC arrangements and the risks they may pose over time.
The deadline for comments on the consultation paper is 15 July 2020. The FSB intends to issue a final report in October 2020.