Weekly Brief No. 7 ·
The FSB says global stablecoins are untested in a crisis, as Singapore weighs joint issuance with foreign issuers
The Financial Stability Board told the G20 that global stablecoins and national rules remain untested in severe stress and insolvency, and singled out stablecoins issued jointly by affiliated issuers in several jurisdictions. Singapore's consultation on joint issuance under the MAS label closed the same week.
In the week of 12 October 2026 the Financial Stability Board (FSB) told G20 finance ministers and central bank governors that global stablecoins and national regulatory frameworks “remain untested in severe stress and insolvency”. It singled out stablecoins issued jointly by affiliated issuers in several jurisdictions, a structure the Monetary Authority of Singapore (MAS) proposes to allow under the MAS label in a consultation that closed on 16 October. The FSB also calls the pseudonymity of public blockchains a structural limit on monitoring. Public chains make supply and flows visible to anyone, but Hong Kong already expects licensed stablecoins to have known holders. On Ethereum, the Foundation confirmed that Glamsterdam reaches the Hoodi testnet on 26 October, with no mainnet date yet.
The FSB’s note on global stablecoins
On 12 October the FSB published a note to the G20, Global Stablecoin Arrangements: Cross-border vulnerabilities and financial stability monitoring, with a letter from its Chair, Andrew Bailey, ahead of the G20 meeting in Bangkok on 15 October (FSB). The FSB puts the stablecoin market at about $300 billion as of mid-2026, unchanged from a year earlier, with 99 per cent by value pegged to the US dollar (note, p. 2).
The note’s argument starts from the holder. A bank knows its depositors and manages redemptions against its whole balance sheet; a global stablecoin issuer “may not know who holds its liabilities, where those holders are domiciled”, or where redemption demand will arise (p. 2). Reserves and holders’ legal claims stay anchored in particular jurisdictions, and redemption runs on the hours of the markets where reserves sit, while the tokens trade around the clock. In stress, the FSB says, that can speed a sell-off faster than redemptions can keep up, and a run could reach banks through reserve sales and deposit withdrawals (p. 2).
It then turns to the “multi-issuer” case: affiliated issuers share liability for one stablecoin but hold separate reserves. If holders can redeem with any issuer, demand “could concentrate on a single entity in the group”, and the rebalancing of reserves across borders depends on coordination that “may break down during stress” (p. 3). Where holders’ locations are unknown, it may be unclear which issuer owes them and which insolvency regime applies (p. 3).
Global stablecoins and national regulatory frameworks remain untested in severe stress and insolvency.
FSB, Global Stablecoin Arrangements: Cross-border vulnerabilities and financial stability monitoring, 12 October 2026, p. 3
The note names no jurisdiction. It says the treatment of foreign-issued stablecoins “remains uncertain or undefined in many jurisdictions” and has opened room for regulatory arbitrage (p. 3). It proposes three areas of further work: monitoring cross-border vulnerabilities, cross-border cooperation and information-sharing, and gathering information on how arrangements plan for distress or failure (p. 4). It sets no dates.
Singapore’s draft amendments to the Payment Services Act propose both structures the note discusses. One is joint issuance from Singapore and a foreign jurisdiction under the MAS label, with safeguards on the shared reserve pool (paras 5.1 to 5.4). The other is case-by-case recognition of a limited number of foreign stablecoins regulated under an equivalent regime (paras 5.12 to 5.14) (Regulatory Wire). The consultation closed on 16 October. MAS has not published its response.
MAS’s joint issuance is the regulated form of the structure the FSB describes, and its safeguards on the shared reserve pool go to the FSB’s concern. The risk in the note is reserves held apart that cannot be moved fast enough when redemptions land on one issuer. The FSB itself says the quantity and quality of reserves, and the framework an arrangement operates under, “remain essential determinants” of its resilience (p. 3). A coin issued jointly under the MAS label would have both: reserve rules in the Payment Services Act and a regulator supervising the shared pool.
Hong Kong’s Stablecoins Ordinance requires a Hong Kong Monetary Authority (HKMA) licence to issue a stablecoin referenced to the Hong Kong dollar, whether in or outside Hong Kong (State of Play). The first two licensees, Anchorpoint and HSBC, are the issuers whose coins Singapore’s recognition route could, in time, cover.
The note also covers data. It says stablecoin activity generates abundant data, but attributing it to uses or geographies is often impossible because “the pseudonymity of many transactions on public blockchains” is a structural limit likely to persist (pp. 4 to 5). Authorities rely mostly on private data compilers whose methods vary (p. 4). The metrics it names are the depth, liquidity and structure of secondary markets, and the geographic distribution of holdings, redemptions and reserve assets (p. 3). It does not define them. The table below sets out where the data for each sits, for the two largest dollar stablecoins on Ethereum and for Hong Kong’s licensed HKDAP.
| Metric | Where the data sits | USDT | USDC | HKDAP |
|---|---|---|---|---|
| Supply, issuance and redemption | Onchain: every mint, burn and transfer is public | 88.3 billion on Ethereum (Etherscan) | 48.1 billion on Ethereum (Etherscan); Circle also discloses mint and burn weekly (Circle) | One contract on Ethereum mainnet (Pilot Scorecard) |
| Holder concentration | Onchain by address, but one exchange address can hold for many customers | 15.3 million addresses on Ethereum | 9.1 million addresses on Ethereum | Whitelisted wallets, each verified by a distributor |
| Secondary-market depth and liquidity | Decentralised exchange pools onchain; trading on exchanges and over the counter is “largely invisible” (IMF, 7 August 2026) | Pools visible; exchange order books not | Pools visible; exchange order books not | No open secondary market during Beta Access |
| Where holders and redemptions are | Not onchain; only model estimates exist | Estimated | Estimated | Known to distributors through whitelisting |
| Reserve assets | Offchain; issuer disclosure | Quarterly attestation by BDO: assets of $187.75 billion against liabilities of $183.64 billion on 30 June 2026 (Tether) | Weekly holdings and a monthly assurance report; most reserves in the Circle Reserve Fund, managed by BlackRock (Circle) | Audited attestations targeted for Full Launch (Pilot Scorecard) |
Ethereum figures are from Etherscan on 18 October 2026. The best-known attempt to place stablecoin flows by country, an IMF working paper, estimates $519 billion of 2024 flows in Asia and the Pacific using machine-learning models, because the chain does not record location (IMF WP/25/141).
For public chains the answer has two parts. At the aggregate, Ethereum gives regulators a record no bank deposit offers: supply, issuance, redemption and every transfer, public and in real time. The HKMA says as much: onchain records “provide some traceability”, and blockchain analytics offer possibilities “not currently available in traditional financial services” (HKMA AML/CFT Guideline for Licensed Stablecoin Issuers, paras 1.10 and 5.10). But the cross-border metrics the note puts first, where holders are and where reserves sit, are not on any chain.
At the level of the holder, regulators in the covered markets do not accept anonymity for the stablecoins they license. The HKMA says that unless an issuer can show its analytics, blacklisting and freezing work, “the identity of each individual stablecoin holder should be verified”, including holders who are not its customers (para 5.11). MAS is weighing verified identity for every holder and limits on unhosted wallets (para 3.23, per the Wire item). Anchorpoint built HKDAP on Ethereum with every holder’s wallet whitelisted. The whitelist that meets the anti-money laundering rule also tells the issuer where its holders are, which is the data the FSB says it lacks. The FSB itself lists smart contract design among the developments that could improve stablecoin data (p. 5).
USDT and USDC work differently. Anyone can hold them in any address, and their contracts carry blacklist functions the issuer can use after the fact (USDT contract, USDC contract). Identity is checked where money enters and leaves, at the issuer and at exchanges. Neither coin is licensed in Singapore or Hong Kong. Singapore’s proposed power to designate a systemic stablecoin, whether or not it is issued there, is how MAS would reach them.
Technology
On 16 October the Ethereum Foundation scheduled Glamsterdam for the Hoodi testnet at epoch 132,352, 17:42:48 UTC on 26 October 2026, with Hoodi’s gas limit rising to 200 million at the same epoch, as on Sepolia (Ethereum Foundation). The post lists Hoodi-ready releases for the Lodestar, Nimbus, Prysm and Teku consensus clients and the Besu, Ethrex and Nethermind execution clients, and says the announcement “does not schedule” a mainnet upgrade. Weekly Brief No. 6 covered the Sepolia activation and the Ethereum mainnet pilots on the Pilot Scorecard that will need to test against it.
On the site
- Under the Hood: A crypto transfer carries no names, so the travel rule sends them in a separate message, 14 October.
What to watch
- 26 October: Glamsterdam and the 200 million gas limit on Hoodi (Ethereum Foundation), then a mainnet date.
- No date: MAS’s response to its stablecoin consultation, and the bill (Regulatory Wire).
- No date: the FSB’s further work on stablecoin monitoring metrics and on planning for distress or failure (note, pp. 4 to 5).