FSB Flags Cross-Border Stablecoin Risks in New Report
A new FSB note examines cross-border stablecoin vulnerabilities in a roughly $300 billion market. Redemption, reserves and monitoring data are central concerns.
On this page
About 99% of stablecoin market value was pegged to the U.S. dollar in mid-2026, in a market worth roughly $300 billion, according to a Financial Stability Board note published on 12 October.
For a buyer or business, the practical issue is how a stablecoin maintains its value and how that value can be converted into usable money.
What the FSB’s stablecoin report measures
The $300 billion estimate is a measure of outstanding market value. It is not an estimate of annual payments, remittances or company revenue.
| Category | Value (% of market value) |
|---|---|
| U.S. dollar-pegged | 99 |
| Other reference currencies, approximate remainder | 1 |
Rounded shares. The approximately 1% remainder is calculated as 100% minus the reported 99% dollar-pegged share. These are not transaction-volume shares.
Source: Financial Stability Board, 12 October 2026.
The FSB points to a timing mismatch: tokens can trade around the clock while reserve management and fiat redemption depend on financial-market operations. Under stress, redemptions may struggle to match selling pressure.
The note also identifies limits in attributing blockchain transfers to countries and uses.
Redemption rights are central to the earlier framework
The FSB’s 2023 recommendations call for clear legal claims and timely redemption. For a stablecoin linked to one fiat currency, they recommend redemption at par into that currency.
Those recommendations also address governance, risk management, disclosures and recovery planning. They are addressed to authorities for implementation within their mandates.
The distinction between a policy recommendation and an individual customer’s rights matters. A holder needs the terms applicable to the actual issuer, asset and service being used.
| Question | What to establish |
|---|---|
| Who is responsible? | The issuer and relevant contracting entities |
| What supports the token? | Reserve composition and the disclosures available |
| How does redemption work? | Eligibility, conditions, timing and costs |
| What happens during disruption? | Applicable support, recovery and legal arrangements |
This is a comparison checklist, not a safety rating. A token’s reference currency does not answer all four questions.
Reserve disclosures provide a starting point
Circle’s USDC transparency page lists reserve categories and assurance reports, including bank deposits, short-dated U.S. Treasuries and overnight reverse Treasury repurchase agreements.
The issuer says it publishes weekly reserve information and monthly third-party assurance. These are Circle’s disclosures about USDC; they should not be applied to every stablecoin.
A reserve statement and a purchase quote serve different purposes. The former describes backing at a reporting date. The latter specifies the price and conditions of a particular transaction.
Readers should check the date, scope and entity covered by a disclosure. Comparing assets solely by the word “stablecoin” misses those differences.
Emerging markets face a separate currency question
In August 2026 remarks on stablecoins and emerging markets, IMF First Deputy Managing Director Dan Katz described potential benefits for payments alongside risks involving currency substitution and financial intermediation.
He also noted that user costs vary across corridors because of entry and exit fees and exchange-rate differences. A low blockchain fee is only one component of a cross-border payment.
For someone spending Kenyan shillings, a dollar-linked token introduces a local-currency conversion question. Tracking the dollar does not fix the token’s purchase or sale price in shillings.
Our analysis of stablecoins in cross-border payments in Africa examines the funding and payout stages around the blockchain transfer.
A simple comparison of peg risk and currency risk
Consider a hypothetical token that stays exactly at $1. If the exchange rate changes from KSh 130 to KSh 140 per dollar, 100 tokens change in shilling value from KSh 13,000 to KSh 14,000 before fees.
That arithmetic assumes an unchanged dollar peg and full conversion at the stated exchange rates. The rates are teaching examples, not current quotes.
| Risk or cost | What changes | Example of what to check |
|---|---|---|
| Peg risk | Token price against its reference currency | Market price and redemption arrangements |
| Currency risk | Reference currency against the buyer’s local currency | Executable local-currency exchange rate |
| Service costs | Amount retained after charges | Spread, conversion, transfer and payout fees |
These factors can operate together. A stable dollar price does not determine the final local-currency amount a recipient receives.
What buyers and businesses should compare
Before buying, establish the asset, supported network, total payment and amount received. Finlazo’s crypto prices and buying tools can help with comparisons and budget estimates; the final purchase quote remains transaction-specific.
Businesses also need to decide whether they want to retain a digital asset or receive local currency. Our guide to accepting crypto payments covers those operational choices.
The FSB note brings renewed attention to the arrangements behind the token. For customers, a useful comparison goes beyond its displayed price to the issuer, the service terms and the route back into usable funds.
