Stablecoin: Difference between revisions

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''Cryptoassets - volatility.''
''Cryptoassets - volatility.''


A stablecoin is a privately issued cryptoasset that aims to provide price stability by backing the coin with other assets.
A stablecoin is usually a privately issued cryptoasset that aims to provide price stability by backing the coin with other assets.
 
 
:<span style="color:#4B0082">'''''Banks use stablecoins - design, regulation & risks'''''</span>
 
:"... various banks and other traditional payment service providers [have] started to use stablecoins for their activities or to issue stablecoins to their customers...
 
 
:In August 2023, PayPal launched a USD-based stablecoin (PYUSD) with Paxos.
 
:In addition, in September 2023, Visa announced it was expanding its stablecoin settlement capabilities with USD Coin (USDC) issued by Circle to merchant acquirers.
 
 
:These initiatives show that stablecoins are no longer the sole domain of cryptoasset providers and may boost the uptake of stablecoins for payments outside the crypto ecosystem.
 
:If not properly designed and regulated, the large-scale use of stablecoins for payments could have serious implications for the safety and efficiency of payment ecosystems."
 
:''BIS survey on central bank digital currencies and crypto - Naresh Aggarwal, ACT Associate Director, Policy & Technical, 19 July 2024.''
 
 
:<span style="color:#4B0082">'''''Not all stablecoins are equally stable'''''</span>
 
:"The umbrella term ‘stablecoin’ has been used to describe a range of instruments with quite different characteristics.
 
:In particular, they may be backed by a range of financial assets, commodities or unbacked cryptoassets (which in some cases are supported by algorithmic protocols).
 
:The robustness of those backing assets and the wider safeguards for guaranteeing stability of value vary significantly across the products labelled as stablecoins."
 
:''Sir Jon Cunliffe, Bank of England Deputy Governor for Financial Stability - Innovate Finance Global Summit - 17 April 2023.''




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:It took place with distributed ledger technology provided by SETL — a UK-based regulated blockchain services provider - which also provided the CBDC stablecoin."
:It took place with distributed ledger technology provided by SETL — a UK-based regulated blockchain services provider - which also provided the CBDC stablecoin."


 
:''Association of Corporate Treasurers Payments landscape blog, Naresh Aggarwal, Associate Director, Policy & Technical, 20 January 2021.''
:''Association of Corporate Treasurers Payments landscape blog, Naresh Aggarwal, Associate Director, Policy & Technical, 20 January 2021''
 




== See also ==
== See also ==
* [[Algorithm]]
* [[Altcoin]]
* [[Altcoin]]
* [[Asset-referenced token]]  (ART)
* [[Bank for International Settlements]]  (BIS)
* [[Bitcoin]]
* [[Bitcoin]]
* [[Blockchain]]
* [[Blockchain]]
* [[Britcoin]]
* [[Britcoin]]
* [[Central bank digital currency]] (CBDC)
* [[Central bank digital currency]] (CBDC)
* [[Commodity]]
* [[Cryptoassets]]
* [[Cryptoassets]]
* [[Cryptocurrency]]
* [[Cryptocurrency]]
* [[Cryptography]]
* [[Cryptography]]
* [[Distributed ledger]]
* [[Distributed ledger]]
* [[E-money token]]  (EMT)
* [[Ecosystem]]
* [[Fiat currency]]
* [[Fiat currency]]
* [[Financial asset]]
* [[Intangible assets]]
* [[Intangible assets]]
* [[Internal Crypto-Assets Task Force]]
* [[Internal Crypto-Assets Task Force]]
* [[Monetary policy]]
* [[Monetary policy]]
* [[Money]]
* [[Money]]
* [[PayPal USD]]  (PYUSD)
* [[Peg]]
* [[Protocol]]
* [[Regulation]]
* [[Ripple]]
* [[Ripple]]
* [[Risk management]]
* [[Token]]
* [[Token]]
* [[USD Coin]]
* [[Treasury]]
* [[Unbacked]]
* [[USD Coin]] (USDC)
* [[Volatility]]
* [[Volatility]]




===External link===
==Other resources==
*[https://www.bis.org/publ/bppdf/bispap147.pdf Embracing diversity, advancing together – results of the 2023 BIS survey on central bank digital currencies and crypto - Bank for International Settlements (BIS) Paper 147 - June 2024]


[https://www.ecb.europa.eu/pub/pdf/scpops/ecb.op223~3ce14e986c.en.pdf Crypto-Assets: Implications for financial stability, monetary policy, and payments and market infrastructures, May 2019, ECB Report]
*[https://www.bankofengland.co.uk/speech/2023/april/jon-cunliffe-keynote-speech-at-the-innovate-finance-global-summit Speech by Sir Jon Cunliffe, Bank of England Deputy Governor for Financial Stability - Innovate Finance Global Summit - 17 April 2023]
*[https://www.ecb.europa.eu/pub/pdf/scpops/ecb.op223~3ce14e986c.en.pdf Crypto-Assets: Implications for financial stability, monetary policy, and payments and market infrastructures, May 2019, ECB Report]


[[Category:Accounting,_tax_and_regulation]]
[[Category:Accounting,_tax_and_regulation]]
[[Category:The_business_context]]
[[Category:Financial_products_and_markets]]
[[Category:Identify_and_assess_risks]]
[[Category:Identify_and_assess_risks]]
[[Category:Manage_risks]]
[[Category:Manage_risks]]
[[Category:Risk_frameworks]]
[[Category:Risk_frameworks]]
[[Category:Cash_management]]
[[Category:The_business_context]]
[[Category:Financial_products_and_markets]]
[[Category:Liquidity_management]]
[[Category:Technology]]

Latest revision as of 10:07, 30 July 2024

Cryptoassets - volatility.

A stablecoin is usually a privately issued cryptoasset that aims to provide price stability by backing the coin with other assets.


Banks use stablecoins - design, regulation & risks
"... various banks and other traditional payment service providers [have] started to use stablecoins for their activities or to issue stablecoins to their customers...


In August 2023, PayPal launched a USD-based stablecoin (PYUSD) with Paxos.
In addition, in September 2023, Visa announced it was expanding its stablecoin settlement capabilities with USD Coin (USDC) issued by Circle to merchant acquirers.


These initiatives show that stablecoins are no longer the sole domain of cryptoasset providers and may boost the uptake of stablecoins for payments outside the crypto ecosystem.
If not properly designed and regulated, the large-scale use of stablecoins for payments could have serious implications for the safety and efficiency of payment ecosystems."
BIS survey on central bank digital currencies and crypto - Naresh Aggarwal, ACT Associate Director, Policy & Technical, 19 July 2024.


Not all stablecoins are equally stable
"The umbrella term ‘stablecoin’ has been used to describe a range of instruments with quite different characteristics.
In particular, they may be backed by a range of financial assets, commodities or unbacked cryptoassets (which in some cases are supported by algorithmic protocols).
The robustness of those backing assets and the wider safeguards for guaranteeing stability of value vary significantly across the products labelled as stablecoins."
Sir Jon Cunliffe, Bank of England Deputy Governor for Financial Stability - Innovate Finance Global Summit - 17 April 2023.


CBDC pilot
"Le Banque de France announced on January 19 that a pilot saw 2 million euro worth of simulated shares purchased and sold by investors using a CBDC.
It took place with distributed ledger technology provided by SETL — a UK-based regulated blockchain services provider - which also provided the CBDC stablecoin."
Association of Corporate Treasurers Payments landscape blog, Naresh Aggarwal, Associate Director, Policy & Technical, 20 January 2021.


See also


Other resources

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