One of the pillars of the GENIUS Act (U.S.) is the requirement that payment stablecoins be backed at all times at a minimum ratio of 1:1 by high-quality assets, such as cash and T-Bills.
Why this matters
- Predictability: ensures that each token can be redeemed for equivalent value, reducing the risk of a loss of parity (de-peg).
- Immediate liquidity: high-quality liquid assets allow a rapid response in stress scenarios.
- Transparency: frequent reporting and asset segregation increase user confidence.
Market effects
- Impact on Treasuries: growing demand for T-Bills increases the interconnection between stablecoins and U.S. public debt.
- International transmission: interest rate or liquidity shocks in the U.S. may be reflected directly in the value of, and confidence in, stablecoins.
- Concentration risk: reserves excessively concentrated in a few assets may amplify volatility in periods of stress.
In Brazil
Law No. 14,478/2022 (the Legal Framework for Crypto Assets) assigned to the Central Bank the authority to regulate virtual assets used as a means of payment, which naturally includes stablecoins. Considering the existing framework for electronic money (Law No. 12,865/2013 and BCB Resolution No. 96/2021, which require full backing by low-risk liquid assets), it is reasonable to expect that future regulation will move in the same direction: 1:1 backing, immediate liquidity, asset segregation and auditable reporting.
In short: requiring 1:1 reserves and frequent reporting is not a technical detail, it is what gives stablecoins the minimum trust needed to operate as digital money at scale.
In the next post, we will address how stablecoins affect monetary policy, especially in emerging economies with fragile currencies and high inflation, where the shift to the “digital dollar” is gaining strength.
