Global stablecoin rulemaking slows, prompting BIS to urge cooperation to avoid fragmentation risks

Policy Share Share this article Copy link X icon X (Twitter) LinkedIn Facebook Email Global stablecoin rulemaking slows, prompting BIS to urge cooperation to avoid fragmentation risks To mitigate risks like sudden withdrawals, policymakers are debating safeguards such as limiting interest payments and offering issuers access to central bank backstops. By Francisco Rodrigues , AI Boost | Edited by Sheldon Reback Apr 20, 2026, 2:31 p.m. Make preferred on Pablo Hernández de Cos (Horacio Villalobos/Corbis via Getty Images) What to know : Global progress on stablecoin standards has slowed, prompting the BIS and Financial Stability Board to warn that fragmented rules could amplify market risks and encourage regulatory arbitrage. To mitigate risks like sudden withdrawals, policymakers are debating safeguards such as limiting interest payments and offering issuers access to central bank backstops. The U.S. is advancing the Digital Asset Market Clarity Act, with a compromise on stablecoin yield potentially clearing the way for a bill markup. Work on global standards for stablecoins has slowed over the past year, raising concern among central bankers that gaps in oversight could split markets and amplify risk. Bank of England Governor Andrew Bailey, who chairs the Financial Stability Board, said progress on international rules has stalled, Reuters reported last week. That's a concern, Bank for International Settlements (BIS) General Manager Pablo Hernández de Cos said Monday in Japan. Global coordination is critical to avoid a patchwork of rules that firms could exploit, de Cos said, according to Reuters. Without international alignment, companies may shift operations to jurisdictions with lighter oversight, a practice known as regulatory arbitrage. The warning comes as major economies push ahead with their own frameworks, often on different timelines and with different approaches. The stablecoin sector has expanded over the last few years, and now accounts for $320 billion according to DeFiLlama . Tether's USDT and Circle Internet's (CRCL) USDC make up most of that figure. De Cos said their structure can resemble securities more than cash, noting that redemption frictions can push prices away from their intended $1 value. He also said that sudden withdrawals could ripple through markets. Proposals to reduce risk include limiting interest payments on stablecoins and giving issuers access to central bank lending facilities or deposit-insurance-type arrangements. Policymakers argue such measures could make the sector safer while preserving its role in digital payments. In the U.S., lawmakers are working to advance the Digital Asset Market Clarity Act , which would set federal rules for digital asset markets. The bill passed the House last year and is now before the Senate, where Banking Committee Chairman Tim Scott and Agriculture Committee Chairman John Boozman are leading the push. Senators Thom Tillis and Angela Alsobrooks have negotiated a compromise on stablecoin yield that could clear the way for a markup, while Senator Cynthia Lummis, who chairs the Banking Committee's digital assets subcommittee, has said a hearing could come in the second half of April . A deal remains contingent on resolving several open questions , including DeFi oversight and ethics provisions. Stablecoins AI Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards . For more information, see CoinDesk's full AI Policy . More For You Previewing Consensus' Policy Summit: State of Crypto By Nikhilesh De | Edited by Aoyon Ashraf 20 hours ago Every year policy discussions get more important, and this year's even more so. Read full story Latest Crypto News Tether backs UAE tokenization firm KAIO in $8M funding round to bring Emirati funds onchain 13 minutes ago Coinbase, Bybit said to be working together on tokenization, custody and distribution of U.S. stocks 48 minutes ago CoinDesk 20 performance update: AAVE price plummets 22.9% over weekend 1 hour ago Bitmine buys 101,627 ether worth over $230 million, its largest weekly haul of 2026 1 hour ago Strategy buys 34,164 bitcoin for $2.54 billion, third-largest purchase on record 2 hours ago U.S.-Iran ceasefire ends, Tesla earnings: Crypto Week Ahead 2 hours ago Top Stories Here's how bitcoin's $7.9 billion April options expiry impact prices 4 hours ago LayerZero blames Kelp's setup for $290 million exploit, attributes it to North Korea's Lazarus 9 hours ago 'DeFi is dead': crypto community scrambles after this year's biggest hack exposes contagion risk 20 hours ago A $300 million borrowing spike on Aave signals liquidity crunch after KelpDAO exploit 5 hours ago Previewing Consensus' Policy Summit: State of Crypto 20 hours ago The $292 million Kelp exploit: how it happened, and what it means for DeFi 16 hours ago