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Report on Stablecoins

CONTENTSE xecutive Summary ..1I. Background ..4 Creation and Redemption of the Stablecoin ..4 Transfer and Storage of the Stablecoin ..5 Activities and Participants in Stablecoin Arrangements ..6 Use of Stablecoins ..7 Digital Asset Trading Platforms and DeFi ..8II. Risks and Regulatory Gaps ..12 Loss of Value: Risks to Stablecoin Users and Stablecoin Runs ..12 Payment System Risks ..12 Risks of Scale: Systemic Risk and Concentration of Economic Power ..14 Regulatory Gaps ..14 III. Recommendations ..15 Legislation ..16 Interim Measures ..18 Illicit Finance Risk ..19 International Standards ..22 Annex: List of Outreach Participants ..231 INTERAGENCY Report ON STABLECOINSE xecutive Summary Stablecoins are digital assets that are designed to maintain a stable value relative to a national currency or other reference assets.

2 broader economy. The potential for stablecoin arrangements to scale rapidly raises additional issues related to systemic risk and concentration of economic power.

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