- A report on Stablecoins examining their most recent advancements were made public on the RBA’s website.
- The authors used the demise of Terra as an example of the fragility of algorithmic Stablecoins.
- The FSA published a report outlining its plans for handling Stablecoins.
On Thursday, a report on Stablecoins that examined their most recent advancements, hazards, and regulatory possibilities was made available on the Reserve Bank of Australia’s official website.
Even while the research pays close attention to dangers, in particular, it is relatively upbeat in stating that “stablecoins have the potential to enhance the efficiency and functioning of a range of payment and other financial services.”
The paper claims that the Australian regulators “are undertaking extensive work” to determine how to incorporate stablecoins into the national payment network without subjecting it to undue risks. The authors list these risks, including those related to energy and the environment, disruptions in the funding markets, growing bank exposure, and liquidity issues.
The authors used the demise of Terra as an example of the fragility of algorithmic stablecoins, whose stability depends on investors’ confidence in the value of an unbacked crypto asset.
The report reiterates that developing a framework for payment
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