For stablecoin issuers, the EBA's liquidity criteria will serve as a liquidity stress test, as stated in the formal proposal. Read the following crypto news to know more.
For stablecoin issuers, the EBA's liquidity criteria will serve as a liquidity stress test. The regulations are expected to go into effect at the beginning of 2024 if they are approved. The EU's banking regulator, the European Banking Authority (EBA), has suggested new rules for stablecoin issuers that would establish minimum capital and liquidity criteria. With the new liquidity requirements in place, the stablecoin should be easily redeemable even when markets are volatile, mitigating the risks of bank runs and contagion. The proposed liquidity requirements would require stablecoin issuers to make available to investors stablecoins backed by a currency that can be redeemed at face value. For stablecoin issuers, the…