Britain plans new safeguards for stablecoins that go bust in wake of Terra's collapse

Britain plans new safeguards for stablecoins that go bust in wake of Terra's collapse

May 31, 2022 by CNBC

Key Facts

  • The government on Tuesday proposed amending existing rules to manage the failure of stablecoin firms that may pose a "systemic" risk.
  • "Since the initial commitment to regulate certain types of stablecoins, events in cryptoasset markets have further highlighted the need for appropriate regulation to help mitigate consumer, market integrity and financial stability risks," the government said in a consultation paper setting out its proposals.
  • "The government considers that it is important to ensure existing legal frameworks can be effectively applied to manage the risks posed by the possible failure of systemic DSA [digital settlement asset] firms for the purposes of financial stability."
  • Tether, the world's biggest stablecoin, saw more than $10 billion in redemptions in the weeks following Terra's collapse, fueling fears of a 2008-style "bank run" with knock-on effects for other financial markets.

Click To Read Full Article

GEOGRAPHY
CRYPTOCURRENCY
MONEY
PERSON
MISCELLANEOUS

This story was produced by the Kwhen Automated News Generator. For more articles like this, please visit us at finance.kwhen.com. Write to editors@kwhen.com. © 2021 Kwhen Inc.

Was this content valuable for you?