BIS issues regulatory recommendations for global stablecoin arrangements

zasad@

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Quote from: Husires on March 08, 2024, 06:54:12 AM

Quote from: zasad@ on March 08, 2024, 01:58:04 AM

You can provide stablecoins with other coins, such as Bitcoin, Litecoin, Dogecoin, but for such a project you will have to use inflated collateral and develop this product for many years. But it will be a completely decentralized stablecoin. Although it will be used by criminals and the developers will be accused of many serious crimes.

Luna was a stable, decentralized coin, more than 60,000 Bitcoin reserves, staking governance token of the Terra blockchain with continuous development and yet failed.
..
After it happened to Luna, I do not think that it is easy for a stablecoin without USD supporting to gain trust at the present time, as it is easy to maintain a stable one if you have sufficient backup balance, so regulatory legislation will greatly harm stablecoins.

I lost a lot of profit in this ecosystem. This ecosystem was like a financial pyramid, because users burned Luna coins, received UST and staked them at 20% per annum.
I wrote that everyone has to pay dearly for good lessons.
If you see a stablecoin that's backed by crap like the Luna coin, don't touch it. Hamsters have a short memory, this story will be repeated more than once.

pakhitheboss

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To which fiat will this GSC (Global Stable Coin) would be pegged? The document doesn't give any indication and as a matter of importance it doesn't give any information why any country would accept a GSC. It only makes me believe that they are trying to control the cryptocurrency market with a new stable coin that will be known as GSC. Another step taken by another financial institution to control decentralized entity like Bitcoin with their own stable coin.

Husires

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Quote from: zasad@ on March 08, 2024, 01:58:04 AM

You can provide stablecoins with other coins, such as Bitcoin, Litecoin, Dogecoin, but for such a project you will have to use inflated collateral and develop this product for many years. But it will be a completely decentralized stablecoin. Although it will be used by criminals and the developers will be accused of many serious crimes.

Luna was a stable, decentralized coin, more than 60,000 Bitcoin reserves, staking governance token of the Terra blockchain with continuous development and yet failed.

After it happened to Luna, I do not think that it is easy for a stablecoin without USD supporting to gain trust at the present time, as it is easy to maintain a stable one if you have sufficient backup balance, so regulatory legislation will greatly harm stablecoins.

zasad@

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Activity: 1932

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Quote from: Husires on March 07, 2024, 12:32:17 PM

Quote from: avikz on March 06, 2024, 12:47:32 PM

But one question still remains - stablecoins can be issued from anywhere in the world. Not sure how the Bank of International settlement is planning to enforce it's regulations onto them.

It is not in the release, I can issue a stablecoin but to be linked to 1 USD. I need to create bank accounts, buy US treasury bonds and more assets that are easy to liquefy to support the stability of the coin. Stable cryptocurrencies can be backed by other assests and not USD like Luna, but we all knew what happened to them. For this reason, the US government can call banks to prevent opening bank accounts for stablecoins companies, and then it will be impossible to maintain a value of $1.

You can provide stablecoins with other coins, such as Bitcoin, Litecoin, Dogecoin, but for such a project you will have to use inflated collateral and develop this product for many years. But it will be a completely decentralized stablecoin. Although it will be used by criminals and the developers will be accused of many serious crimes.

Husires

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Quote from: avikz on March 06, 2024, 12:47:32 PM

But one question still remains - stablecoins can be issued from anywhere in the world. Not sure how the Bank of International settlement is planning to enforce it's regulations onto them.

It is not in the release, I can issue a stablecoin but to be linked to 1 USD. I need to create bank accounts, buy US treasury bonds and more assets that are easy to liquefy to support the stability of the coin. Stable cryptocurrencies can be backed by other assests and not USD like Luna, but we all knew what happened to them. For this reason, the US government can call banks to prevent opening bank accounts for stablecoins companies, and then it will be impossible to maintain a value of $1.

zasad@

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Quote from: Husires on March 06, 2024, 07:43:27 AM

Quote from: zasad@ on March 06, 2024, 05:35:04 AM

The document is small and worth reading. And in practice, such recommendations will soon become mandatory. And stablecoins will have the same requirements as international currencies, which means total KYC and all other delights.

If a broad regulatory framework is established for cryptocurrencies, I do not think that we will need stablecoins, as it will be easy to create a bank account in dollars and buy Bitcoin directly from banks. I do not think we will be allowed to withdraw Bitcoin, but it will be the next step after extensive regulation.
If this broad regulation does not happen, then most likely stablecoins will be regulated such that you need KYC to create a wallet, but due to the inability to regulate DAI, these steps will not change the non-KYC stablecoin option.

https://daistats.com/#/
I store most stablecoins in DAI, but I don't like this picture at all. Previously, DAI had a lot of stablecoins in the collateral and they were heavily dependent on USDC, but now there are a lot of RWA (Real-World Asset) in the collateral. This is also bad.

Quote from: avikz on March 06, 2024, 12:47:32 PM

But one question still remains - stablecoins can be issued from anywhere in the world. Not sure how the Bank of International settlement is planning to enforce it's regulations onto them.

Unfortunately, this issue has not yet been resolved, how to make an ideal stablecoin, independent of regulators, and so that there are no problems with trust. Any algorithmic stablecoin requires excessive collateral, and even for DAI this figure is more than 300%.
We all want decentralization, but no one uses the Ethereum Classic ecosystem, and it is almost dead. The same will happen with other stablecoins.

avikz

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All stablecoins are anyways centralized. It's just that the issuing companies are not enforcing KYC on their users. But they indeed can start enforcing a strict KYC mandate to its users. But that might become a bottleneck in their usage and many would probably choose to leave stablecoin segment altogether.

But one question still remains - stablecoins can be issued from anywhere in the world. Not sure how the Bank of International settlement is planning to enforce it's regulations onto them.

Husires

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Quote from: zasad@ on March 06, 2024, 05:35:04 AM

The document is small and worth reading. And in practice, such recommendations will soon become mandatory. And stablecoins will have the same requirements as international currencies, which means total KYC and all other delights.

If a broad regulatory framework is established for cryptocurrencies, I do not think that we will need stablecoins, as it will be easy to create a bank account in dollars and buy Bitcoin directly from banks. I do not think we will be allowed to withdraw Bitcoin, but it will be the next step after extensive regulation.
If this broad regulation does not happen, then most likely stablecoins will be regulated such that you need KYC to create a wallet, but due to the inability to regulate DAI, these steps will not change the non-KYC stablecoin option.

zasad@

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Activity: 1932

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https://www.theblock.co/post/280063/bis-regulatory-recommendations-stablecoin-arrangements
The Bank for International Settlements has issued recommendations for the regulation, supervision and oversight of global stablecoin arrangements.

"The Bank for International Settlements has proposed recommendations for regulating global stablecoins.

In a summary of recommendations issued on Thursday, the BIS described GSCs as widely adopted stablecoins with a potential reach and use across multiple jurisdictions. "A GSC could become systemically important in and across one or many jurisdictions," the BIS said. "

https://www.bis.org/fsi/fsisummaries//global_stablecoins.pdf
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The document is small and worth reading. And in practice, such recommendations will soon become mandatory. And stablecoins will have the same requirements as international currencies, which means total KYC and all other delights.

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