Reserve Requirements

Definition ∞ Reserve requirements are stipulations mandating that financial institutions hold a certain percentage of their liabilities in reserve, rather than lending them out. For stablecoins, this often translates to requirements for issuers to hold equivalent assets backing the circulating supply. This practice aims to bolster confidence in the stablecoin’s peg and prevent liquidity crises.
Context ∞ Discussions surrounding reserve requirements for stablecoins are prominent in regulatory and market analyses. News reports frequently scrutinize the composition and adequacy of reserves held by major stablecoin issuers, particularly in the wake of past de-pegging events. The current debate focuses on establishing clear, verifiable standards for reserve management and the potential implications for monetary policy and financial stability.

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→Federal Stablecoin Regulation

→Digital Asset Legislation

→Reserve Requirements

US Congress Passes Landmark GENIUS Act Establishing Federal Stablecoin Framework

The GENIUS Act codifies payment stablecoins as non-securities, mandating new federal capital, reserve, and audit requirements for all issuers.

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→Banking Regulation

→Reserve Requirements

→Systemic Risk

Federal Reserve Finalizes Novel Activities Supervision for State Banks

Supervised institutions must secure Fed non-objection for novel activities, formalizing a heightened, pre-emptive risk-management compliance mandate.

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→Regulatory Clarity

US Congress Finalizes Stablecoin Law Establishing Mandatory Federal Reserve Standards

New federal reserve requirements mandate 1:1 backing, forcing issuers to overhaul compliance and reserve management systems immediately.