On September 24, American Banker quoted Christopher Boone on the risks of a potential stablecoin collapse and its broader implications for financial systems. According to the article, a “stablecoin failure could echo throughout the banking system.”
Boone noted that giving stablecoin holders priority over other creditors was designed to strengthen public confidence: “The idea behind having holders with first priority over all other creditors is to make that as strong as possible, to shore up the kind of financial backing of this structure as a whole.”
For nonbank stablecoin issuers, the GENIUS Act provides no lender of last resort, leaving no clear mechanism to manage a crisis.
“If the issuer is a bank, then the banking regulators could, in theory, step in,” Boone said. “It's less clear what would happen if the issuer is a nonbank. I mean, that's just kind of completely uncharted territory.”
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