FSB urges cross-border plans for stablecoin runs as market tops $300B

Key points

• FSB published a stablecoin report Oct. 12 ahead of the Oct. 15 G20 finance meeting
• Multi-issuer coins can see redemptions hit one entity while reserves sit in another country
• Market is about $300 billion, with CoinDesk citing $306 billion, mostly dollar-pegged
• FSB wants more information sharing and contingency plans; the steps are not binding

The Financial Stability Board (FSB), the G20’s global financial watchdog, on Monday urged regulators to share more information across borders and to plan for the distress or failure of a major stablecoin. In a report published Oct. 12, the body said stablecoin arrangements that span several jurisdictions could face redemption problems in a crisis even when total reserves are adequate, CoinDesk reported.

According to CoinDesk, stablecoin market capitalization began 2025 at about $206 billion and has grown to roughly $306 billion, most of it tied to the U.S. dollar. CryptoSlate put the market at about $300 billion and said 99% of its value is pegged to the dollar.

How multi-issuer stablecoins create run risk

The FSB’s concern centers on stablecoins issued jointly by affiliated companies in different countries. In such arrangements, holders can often redeem through any issuer in the group. Demand can therefore concentrate on one entity while the reserve assets sit with another, in a different jurisdiction.

Moving those reserves during a panic could be slow or difficult, according to the reports, because of banking restrictions, settlement delays and differing national rules. It may also be unclear which country’s insolvency regime would apply. Pseudonymous blockchain transactions add to the problem by making it hard to determine where holders are located and which entity is responsible for a given redemption.

A timing mismatch compounds the risk. Stablecoins trade around the clock, while the markets for the assets backing them, such as Treasuries and bank deposits, keep set hours. If redemptions cannot keep pace with selling, a token could slip below its peg. CoinDesk said deep secondary markets and arbitrage can help restore a peg. The FSB also warned that forced reserve sales or withdrawals of bank deposits could carry a shock into traditional markets.

CryptoSlate cited Circle’s USDC as an example of a co-issued coin. Circle issues it through a French entity for the European Economic Area and a U.S. entity for other markets. Under Circle’s MiCA redemption policy, which CryptoSlate said was updated in September, Circle France may adjust or defer certain redemptions during a defined stress event. CryptoSlate described these as contingency provisions rather than evidence of an existing failure.

What the FSB recommends

The watchdog called for stronger cross-border information sharing, closer monitoring of where stablecoins circulate and where reserves are held, assessment of secondary-market liquidity, and coordinated approaches to distress or insolvency. CryptoSlate said the measures build on the FSB’s 2023 recommendations, and that the FSB’s 2025 review found substantial gaps in how countries have implemented them.

FSB Chair Andrew Bailey, who is also Governor of the Bank of England, wrote an accompanying letter. CoinDesk quoted it as saying that global stablecoin arrangements are inherently cross-border while national regulations are taking shape at different speeds. The FSB report and Bailey’s letter are posted on the board’s website.

What happens next

The FSB’s recommendations are not legally binding, though members generally commit to carrying out agreed standards in their own jurisdictions, CoinDesk reported. CryptoSlate noted that no timetable exists for common cross-border procedures for handling a stablecoin failure.

The findings are due to go to the G20 finance ministers and central bank governors meeting on Oct. 15.