LATEST: Bank of Mexico Flags Major Financial Stability Risks in Stablecoins
In a new report, Mexico’s central bank highlights significant concerns regarding the growing ecosystem of stablecoins.
Key identified risks include:
🔹Heavy Reliance on Short-Term US Treasurys: Raises vulnerability to liquidity shocks and market stress.
🔹High Market Concentration: A small number of issuers and assets dominate, creating systemic vulnerability.
🔹Global Regulatory Gaps: Inconsistent and fragmented oversight across jurisdictions complicates risk management.
The report underscores that these factors could transmit volatility to traditional financial systems, urging for coordinated international regulatory frameworks.
