Page 30 - gs250801

Insights and Expertise

Beyond the buzzword: are opaque or your redemptions are sluggish. A
credible stablecoin proves, in real time, that $1 in
Crafting a credible equals $1 out, and backs it with rigorous attestations
and resilient reserves.
stablecoin offering • Compliance isn't a checkbox; it's a foundation. U.S.
regulators are tightening their grip. Issuers who
treat legal clarity as a non-negotiable build the trust
that attracts both users and institutional partners.
• Trust isn't built on tech alone. Code matters, but so
do governance, brand equity and the caliber of your
partners.

What the market needs is financial instruments people
can depend on. And in the coming wave of scrutiny and
consolidation, only those who build with credibility at the
core will still be left standing.

Navigating regulation
The era of regulatory ambiguity is closing fast, and
stablecoin issuers should see that as both a wake-up call
and an opportunity. Here's what the emerging landscape
means for builders on both sides of the Atlantic:
Europe's Markets in Crypto-Assets (MiCA), now
fully in effect, classifies stablecoins as either Asset-
By Angela Yore Referenced Tokens (ARTs) or E-Money Tokens (EMTs),
Skyparlour requiring full 1:1 backing with liquid reserves, licensing
and detailed disclosures. Algorithmic stablecoins are
tablecoins are no longer the crypto world's outright banned, and daily transaction volumes over
best-kept secret. Once whispered about in defi £200 million trigger stricter capital requirements (see
forums and Twitter threads, they're now on the https://coinlaw.io/stablecoins-regulations-under-mica-
S lips of policymakers, payment giants and cen- statistics/).
tral banks alike. From powering cross-border transactions
to unlocking real-world utility in digital wallets, stable- Passed by the Senate in June 2025, the GENIUS Act
coins are quietly becoming the plumbing of the future establishes the first federal framework for dollar-
financial system. pegged stablecoins (see https://www.congress.gov/
bill/119th-congress/senate-bill/394/text/is). It mandates
But as excitement builds, so does noise. Headlines tout the full reserve backing (cash and short-term Treasuries),
next "breakthrough coin" weekly, yet far too many offerings monthly public audits and anti-money laundering
rely on duct-taped code, vague reserve disclosures, or compliance. It also opens the door for banks, fintechs
governance models held together by hope and hype. In and even retailers to issue stablecoins under Treasury
the race to issue, few pause to ask: What actually makes a oversight.
stablecoin credible?
In both the United States and Europe, credibility now
The new gold standard means showing your compliance work before the
mandates roll in. That includes KYC/AML programs,
We're seeing a digital dollar gold rush, and plenty of state-by-state licensing strategies, and transparent reserve
people are looking to get a piece of the stablecoin action. attestations. But regulation isn't the villain in this story,
But not every offering is ready to meet the demand. If your and the smartest issuers are embracing it by designing for
stablecoin isn't engineered for transparency, governed compliance rather than seeing it as a stumbling block.
with integrity and architected to withstand regulatory
scrutiny, it's not a payment asset, but a liability waiting to Engineering trust
happen.
It's one thing to talk about trust; it's another to design for
So, what separates the credible from the copycats? it. In the stablecoin world, architecture is where credibility
either gets baked in or blown up. And as regulators sharpen
• Stability isn't assumed; it's engineered. Pegging their pencils and institutional users come knocking, the
to the U.S. dollar means nothing if your reserves margin for shortcuts is narrowing fast.
30