The Financial Stability Board (FSB) today published a detailed assessment of cross‑border vulnerabilities in global stablecoin arrangements, warning that their structure, international reach and uneven regulatory treatment could amplify financial‑stability risks across jurisdictions.
The report finds that global stablecoins — defined as tokens with reach across multiple jurisdictions and potential systemic importance — remain “an inherently cross‑border and cross‑sectoral issue”, with activities spanning several types of entities and falling under multiple national authorities. As of mid‑2026, the total market value of stablecoins stands at around $300bn, with 99% pegged to the US dollar.
The FSB says the international mobility of stablecoin liabilities, combined with pseudonymous circulation on public blockchains, limits the ability of any single jurisdiction to assess or address vulnerabilities. Issuers may not know who holds their tokens or where redemption demand will materialise, while reserve assets and legal protections remain anchored in specific jurisdictions. In stress, round‑the‑clock secondary‑market trading could accelerate sell‑offs and put pressure on pegs if redemptions cannot keep pace.
The analysis highlights structural fragilities in multi‑issuer arrangements, where affiliated entities share liability for a single coin but hold separate reserves. In stress, redemption demand could concentrate on one issuer, while cross‑border reserve rebalancing may face frictions. The report warns that if the location of holders cannot be reliably determined, the attribution of liabilities and legal claims may be unclear in both stress and insolvency. It also cautions that global stablecoins and national regulatory frameworks remain untested in severe stress events.
Regulatory divergence is emerging as a significant source of risk. The FSB says uneven implementation of its 2023 recommendations has contributed to complex cross‑border structures and opportunities for regulatory arbitrage, with some issuers choosing to operate from lightly regulated jurisdictions. The interaction of regulatory frameworks across borders, it adds, remains uncertain or undefined in many jurisdictions, including the treatment of foreign‑issued stablecoins.
The report also underscores persistent data challenges. Authorities rely heavily on private compilers that use proprietary methods to aggregate blockchain and off‑chain data, creating comparability and credibility risks. Structural constraints — including pseudonymity and non‑standardised smart‑contract infrastructure — limit the ability to attribute stablecoin activity to specific geographies or uses. While data availability has improved, the FSB says further progress will require better disclosure, cross‑border analytical expertise and exploration of industry best practices for on‑ and off‑chain data collection.
Today’s publication accompanies a letter sent on 9 October by FSB Chair Andrew Bailey to G20 finance ministers and central bank governors ahead of their meeting on 15 October. Bailey’s letter highlights broader risks to the global financial system, including heightened volatility in sovereign bond markets, vulnerabilities in private credit markets and emerging risks associated with artificial intelligence.
It also introduces several other reports being delivered to the G20, including a thematic peer review on public‑sector backstop funding mechanisms, a consultation on regulatory and supervisory modernisation, finalised sound practices for responsible AI adoption and the G20 Implementation Monitoring Review.
The FSB says stablecoin innovation continues to advance, but so do the cross‑border risks and supervisory expectations surrounding it. It calls for enhanced monitoring of vulnerabilities, stronger cross‑border cooperation and deeper planning for potential distress or failure of global stablecoin arrangements.
