BIS urges global stablecoin rule cooperation

Global progress on stablecoin regulation has slowed, prompting the Bank for International Settlements (BIS) and the Financial Stability Board to issue warnings about potential fragmentation risks. They emphasize the need for international cooperation to prevent regulatory arbitrage, where firms exploit differing oversight rules across jurisdictions. Policymakers are considering safeguards like limiting interest payments and providing access to central bank backstops to mitigate risks such as sudden withdrawals and price instability. Meanwhile, the U.S. is advancing its own Digital Asset Market Clarity Act, with potential compromises on stablecoin yield that could move the bill forward.