FSB Warns $300B Stablecoin Market Faces Liquidity Run Risks Across Borders

The Financial Stability Board (FSB) released a report warning that the stablecoin market, valued at approximately $300 billion in mid-2026, could face redemption crises due to cross-border reserve inaccessibility. According to the global financial watchdog, stablecoins issued by multiple affiliated entities in different countries can experience severe liquidity mismatches when withdrawal demand spikes in one jurisdiction while collateral remains locked in another. Digital tokens operate around the clock, but the traditional assets backing them—such as Treasury securities and bank deposits—are constrained by local financial-market operating hours, banking restrictions, and settlement delays. The FSB cautioned that these delays could force token holders to sell at a discount on secondary markets, destabilizing dollar pegs and potentially spilling into traditional finance if issuers must rapidly liquidate reserve assets. FSB Chair Andrew Bailey noted that international regulatory coordination remains underdeveloped, and officials plan to review the non-binding findings at the October 15 G20 meeting of finance ministers and central bank governors.