Stablecoin growth could affect credit markets, rating agency warns
Fitch notes potential asset contagion risks posed by stablecoins could lead to tighter regulations for the industry. The growth of stablecoins that are not fully backed by safe assets could trigger a destabilization in short-term credit markets, rating agency Fitch has warned.In a commentary note, the agency explained that coins that are fully backed by safe assets pose a lesser risk for the financial markets. The agency gives USD Coin (USDC), which is backed by U.S. dollars on a 1:1 basis held in custody accounts, as an example for fully-backed stablecoins, but warned that the authorities....
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American credit rating agency Fitch Ratings, one of the ‘Big Three’ credit rating agencies, has published a report that says stablecoin growth could affect securities and commercial paper (CP) markets. The agency says stablecoins could be “disruptive” and “stablecoin-related turbulence” could “transmit shocks” to other markets.
Fitch Ratings: ‘Stablecoins Could Be Disruptive for CP Markets’
On Monday, the ‘Big Three’ credit agency Fitch Ratings published a report on stablecoins and the growth of....
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