The International Monetary Fund released a detailed study on Thursday that reviews the fast rise of stablecoins and the state of rules meant to guide their use. The document outlines how major regions, including the United States, the United Kingdom, Japan, and the European Union, have each set up their own approaches.
The IMF notes that these efforts aim to reduce risks to wider financial systems, yet the overall picture remains uneven across regions and across different types of issuers.
According to the report, activity in the sector continues to grow across blockchains. The Fund states that this pattern may lead to gaps that slow cross border payments. It also warns that different rule sets can create hurdles for firms when they move funds from one region to another.
The report says that officials should strengthen broad economic policies and institutions before relying on new rules. It also calls for cooperation among countries, since stablecoins operate in markets that cross borders with ease.
Different Approaches and Stablecoins Demand
The IMF highlights that the two largest stablecoins by market size, USDT from Tether and USDC from Circle, rely heavily on short term US Treasurys, reverse repo deals backed by US Treasurys, and bank deposits.
The report says that around 40% of USDC’s reserves and about 75% of USDT’s reserves are tied to short term US Treasurys. Tether also holds around 5% of its reserve pool in Bitcoin. This structure has drawn interest from regulators, since movements in these assets can influence broader markets.
Most stablecoins around the world track the US dollar. Even so, a smaller set of issuers produce coins linked to other currencies such as the euro. As of writing, the worldwide market for stablecoins grew past $316 billion. The Fund notes that this size shows the need for rules that can keep pace with changing conditions.
US Developments After the GENIUS Act
In the United States, rulemaking has picked up following the signing of the GENIUS Act in July by Donald Trump. The law seeks to set up a full set of rules for payment stablecoins. Regulators have been working on the next steps, which include supervision and clearer guidance for issuers.
On Thursday, blockchain security group CertiK stated that the new law has already shaped trading activity. This is because liquidity is now moving into separate pools for US and EU based coins.