At the Summer Davos 2025, Li Bo, Vice President of the International Monetary Fund, raised questions about classification and regulation of stablecoins, emphasizing the need for a clear regulatory framework.
Importance of Stablecoin Classification
Li Bo expressed concerns about the need for stablecoins to be clearly classified as either currency or financial assets. This classification will determine how they will be regulated across different countries under various legal frameworks. His remarks highlight the urgent need for established regulatory systems, especially regarding whether stablecoins fall into M0 or M2 categories, impacting anti-money laundering policies.
Impact on USDT and USDC
Market observers note that while short-term financial impacts remain uncertain, high-level discussions signal a growing emphasis on compliance, likely affecting major stablecoins like USDT and USDC. CoinMarketCap data indicates that Tether USDt (USDT) holds a market cap of $156.73 billion with a trading volume of $69.52 billion, despite a recent 0.04% price dip over 24 hours. USDT remains stable at $1.00 amid market fluctuations.
Regulatory Prospects
The Coincu research team notes that clearer regulatory classifications could alleviate market volatility, offering institutional investors stable grounds for engagement. This evolving landscape presents opportunities for new frameworks to support stablecoin growth, balancing compliance and innovation.
Increased discussions surrounding stablecoin regulation could significantly alter their status and the market at large. It is essential that the regulatory frameworks developed foster the stable growth of this segment of financial technology.
