Circle urges SEC to treat compliant payment stablecoins as cash and eliminate market-maker haircuts

Summary

Circle submitted a comment letter to the SEC on October 20 arguing that under the proposed crypto asset framework, qualifying payment stablecoins (such as USDC) should be treated as cash for certain regulatory purposes, with broker-dealer capital rules adjusted accordingly. Specific asks include: s…

Key points

Institutions watching how stablecoins are positioned in securities regulation and capital charges can grasp the direction rules may take.
If stablecoins are treated as cash in capital rules, it will directly lower the capital cost for institutions to hold and settle stablecoins.
Broker-dealers' and custodians' reserve and capital calculations may change, and willingness to use stablecoins in settlement flows will rise accordingly.

Crypto Weekly

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