Tokens jointly issued by multiple companies may lock up reserves in one jurisdiction, while redemption requests arise in another jurisdiction, thereby complicating the response to cross-border crises.
The Financial Stability Board ( FSB ) warns that global stablecoins and national regulations have not been tested in severe market crises, which could lead to delays in redemptions and reserves.
This regulatory agency calls for enhanced cross-border information sharing and monitoring, as well as planning in the event of pressures or failures related to tokens pegged to fiat currencies.
FSB indicates that a multi-issuer model may trap reserves in one jurisdiction, while redemption demands arise in another, thereby complicating the response to cross-border crises; at the same time, 24-hour trading and anonymous transactions also increase the risk of systemic shocks.
The Financial Stability Board warns in its report that stablecoins may expose gaps in cross-border financial regulations during market crises, and since they have not been tested under such circumstances, it calls for enhanced cross-border information sharing, monitoring, and planning in the event of pressure or failure related to stablecoins.
This G20 financial regulatory agency stated that global stablecoins—i.e., cryptographic tokens whose value is pegged to fiat currencies—have not yet been tested under severe stress or insolvency scenarios. Moreover, the pace at which regulatory frameworks are being established varies from country to country, raising a question: if the issuers go bankrupt, how will holders be able to retrieve their funds?
According to FSB, the market value of stablecoins at the beginning of 2025 was approximately $206 billion, and it has now grown to $306 billion. The majority of this value comes from stablecoins pegged to the US dollar. FSB indicates that these tokens are currently mainly used for transferring funds between crypto investments, but in the future, they may also support faster and cheaper payments, including cross-border payments.
"Global stablecoin arrangements are essentially cross-border in nature, but regulatory frameworks in different countries are being established at varying speeds, and cross-border cooperation in this field is still in its infancy," wrote Andrew Bailey ( Andrew Bailey ), chairman of FSB, in the accompanying letter.
FSB warns that if holders can redeem from any issuer within the group, demand may concentrate on a single entity, while the required assets are scattered elsewhere. Transferring these reserves during a crisis could become more difficult. The institution also stated that if an issuer fails, legal claims may become unclear, as it would be hard to determine which country's bankruptcy rules should apply.
Stablecoins can be traded around the clock, while the asset markets that underpin their value have fixed trading hours. FSB added in the report that this mismatch can be significant during a run on the bank, as tokens may lose their peg if redemptions cannot keep up with sales.
However, FSB pointed out that a deep and liquid secondary market could also help tokens return to their anchored levels through arbitrage.
Forced sales of reserves and withdrawals from bank deposits may subsequently transmit the impact to traditional financial markets, as investors will scramble to seek liquidity.
FSB also pointed out that insufficient data is a problem, as the anonymity of cryptocurrency transactions can make it difficult to determine where the holders are located and which jurisdiction should apply.
Bellie is also the Governor of the Bank of England, and he has previously warned that progress in the formulation of international stablecoin regulations has stalled. FSB At the time of the release of this report, there are only a few days left until the meeting on October 15th between the G20 Chancellor of the Exchequer and the central bank governors.
