Asset Reserve Management involves the strategic oversight and safeguarding of assets held to back a stablecoin or other collateralized digital asset. This process ensures the stability and solvency of the digital asset by maintaining sufficient reserves. It includes managing the composition, custody, and auditing of these underlying assets.
Context
Asset Reserve Management is a central topic in the stability and credibility of stablecoins, particularly following market volatility events. A key debate focuses on the transparency and auditability of reserves, with calls for real-time attestations and clearer regulatory standards. Future developments will likely see increased scrutiny from regulators and a move towards more diversified and liquid reserve holdings.
The HKMA's new Ordinance mandates licensed issuers maintain full reserves and segregated client assets, fundamentally de-risking the APAC stablecoin market.
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