#monetaryrisk — Public Fediverse posts

Financial Boffins are calling out issues/gaps/concerns re the recently passed GENIUS Act that pose RISKS! Here are a few ...

1. financial regulators need to write capital, liquidity, and risk management requirements for the Act
2. permissible reserve assets can include uninsured deposits in banks and shares of credit unions
3. does not prohibit payment stablecoins from being counted as a cash or cash-equivalent asset on a corporate balance sheet
4.allows for both Treasury repo and Treasury reverse repo transactions to meet liquidity needs
5. nonfinancial companies can be permitted to issue stablecoins
6. input from regulators is needed to address risks of stablecoins being used for illicit activities
7. no reference to maintaining par-value exchange in the secondary markets
8. no definition of what interoperability actually means
9. does not address if stablecoins from different issuers should be fungible
10. lacks requirements for transparency, accountability, and enforcement of technical infrastructure used for stablecoins
11. prohibits issuers from paying interest or yield to holders, but does not ban third parties from paying interest

https://www.brookings.edu/articles/stablecoins-issues-for-regulators-as-they-implement-genius-act/ #Crypto #Stablecoins #GENIUSAct #Congress #Risk #FinancialRisk #MonetarySystem #Money #Cryptocurrencies #MonetaryRisk

Financial Boffins are calling out issues/gaps/concerns re the recently passed GENIUS Act that pose RISKS! Here are a few ...

1. financial regulators need to write capital, liquidity, and risk management requirements for the Act
2. permissible reserve assets can include uninsured deposits in banks and shares of credit unions
3. does not prohibit payment stablecoins from being counted as a cash or cash-equivalent asset on a corporate balance sheet
4.allows for both Treasury repo and Treasury reverse repo transactions to meet liquidity needs
5. nonfinancial companies can be permitted to issue stablecoins
6. input from regulators is needed to address risks of stablecoins being used for illicit activities
7. no reference to maintaining par-value exchange in the secondary markets
8. no definition of what interoperability actually means
9. does not address if stablecoins from different issuers should be fungible
10. lacks requirements for transparency, accountability, and enforcement of technical infrastructure used for stablecoins
11. prohibits issuers from paying interest or yield to holders, but does not ban third parties from paying interest

https://www.brookings.edu/articles/stablecoins-issues-for-regulators-as-they-implement-genius-act/ #Crypto #Stablecoins #GENIUSAct #Congress #Risk #FinancialRisk #MonetarySystem #Money #Cryptocurrencies #MonetaryRisk