US Credit Ratings Giant Developing Stablecoin Scoring System: Report
One among three largest credit standing companies is reportedly engaged on a scoring system for cryptocurrencies pegged to different property, such because the US greenback, gold or different digital property.
In accordance with a brand new report from Bloomberg, credit standing titan Moody’s is creating a system that may analyze as much as 20 stablecoins based mostly on the standard of the attestations on the reserves that they’re backed with.
Stablecoin issuers periodically publish reserve attestation studies licensed by third-party audit corporations that conduct an impartial assessment to make sure that every unit of stablecoin is sufficiently backed by collateral held in reserve.
Moody’s is creating the scoring system amid rising curiosity in stablecoins, spurring issues from regulators and buyers, in response to the report.
In 2021, US authorities fined Tether, the issuer of the most important stablecoin by market cap, for mendacity about its reserves.
The crash of the Terra ecosystem in Might 2022 was additionally linked to the collapse of its algorithmic stablecoin. The worth of Terra (LUNA) plummeted after TerraUSD (UST) failed to keep up its peg to the US greenback.
An individual with information about Moody’s new stablecoin scoring system says the challenge continues to be within the early levels and won’t characterize an official credit standing.
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