FSB Tells the G20 Global Stablecoins Are Untested in Severe Stress

The Financial Stability Board published a note to the G20 on 12 October saying that global stablecoins, and the national rules built around them, have never been through a crisis. It went out with a letter from FSB chair Andrew Bailey dated 8 October, ahead of the 15 October meeting of G20 finance ministers and central bank governors in Bangkok. The note is a monitoring summary and binds nobody. Its subject is narrow and specific: what happens when one coin has several issuers in several countries and holders all redeem at once.

"Global stablecoins and national regulatory frameworks remain untested in severe stress and insolvency," the note said.

Where the redemptions pile up

The structure the board keeps returning to is the multi-issuer arrangement, in which affiliated companies issue the same coin, share liability for it and hold separate reserves. A holder able to redeem with any issuer in the group will go to whichever one is easiest, so demand can land on an entity whose reserves sit in another country. Shifting reserves across a border is harder in a crisis than on a quiet day. If nobody can establish where the holders are, it gets harder still to say whose insolvency law applies and who owes what to whom. CoinDesk, which read the note the same morning, adds that pseudonymous transactions are part of why holder locations stay unclear. National rulebooks move at their own speeds, and European firms have until 8 January to drop non-MiCA stablecoins, a deadline with no counterpart elsewhere.

Clocks that do not match

The second vulnerability is a timing one. Stablecoins trade every hour of every day; the markets holding their reserves keep office hours and settlement cycles. If redemptions outrun what an issuer can sell, the peg takes the strain, and the note says that mismatch could make a sell-off both faster and larger. The board puts the opposite case in the same paragraph: deep secondary markets let arbitrage pull a wobbling token back to par. Neither branch has been through a real test. What sits behind the peg matters here too, and reserve portfolios are facing a 31 December clearing date of their own.

Two counts of the same market

Sizing the market is where the readings part. The note puts the total stablecoin market at about $300 billion in mid-2026, roughly flat on a year earlier, with about 99% of that value pegged to the dollar. CoinDesk's account of the same document gives $206 billion at the start of 2025 rising to $306 billion, and says most of the value is dollar-pegged. A flat year and a rise of roughly $100 billion are not the same claim, and CoinDesk names no data source at either end. We could not establish where its pair of figures came from. This desk read both documents directly.

What the board asks for next

The note asks authorities to build a set of monitoring metrics and find the data gaps behind them: how deep and liquid the secondary markets are, and where holdings, redemptions and reserve assets actually sit, with multi-issuer coins first in line. Past measurement, it asks for cross-border cooperation and information sharing to support the board's 2023 recommendations on stablecoin arrangements, which went through a peer review last year, and for work on how authorities would handle an issuer in distress or failure. None of that is binding. Members do usually put agreed standards into national practice, on their own timetables.

Bailey's letter says cross-border cooperation in this area "is still in its infancy". The note sets no deadline for the metric work and names no jurisdiction. What it does is put the multi-issuer question in front of finance ministers three days before they sit down. Whether it goes anywhere depends on what those ministers hand back to the board, and on whether the first real redemption run arrives before the measurements do.