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Stablecoins could come under securities rules - Iosco

Stablecoins often include features seen in securities and may therefore come under the same rules, according to the International Organization of Securities Commissions (Iosco).

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Stablecoins could come under securities rules - Iosco

Editorial

This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community.

With Facebook's Libra project making headlines, stablecoins have come under increasing scrutiny from regulators and politicians.

Iosco says that while stablecoins can potentially offer benefits to market participants, consumers and investors, they also pose risks around consumer protection, market integrity, transparency, conflicts of interest and financial crime.

The global group, made up of national securities regulators, says that a case-by-case approach should be taken to assessing which of its standards should apply to individual stablecoins.

But, Ashley Alder, chair of the Iosco board, warns: "Our analysis has shown that so-called ‘stablecoins’ can include features that are typical of regulated securities.

"This means Iosco Principles and Standards may apply to stablecoins depending on how they are structured, including those related to disclosure, registration, reporting and liability for sponsors and distributors."

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