Stablecoins, such as Facebook’s Libra, not only pose “serious public policy and regulatory risks,” they also ought to be regulated as securities, the International Organization of Securities Commissions said today.

In a statement, IOSCO—a global association of regulators, including the U.S. Securities and Exchange Commission—reiterated concerns regarding so-called “stablecoins” raised by a recent G7 report, and added that such instruments can include features that are “typical of regulated securities.” 

To arrive at this conclusion, IOSCO has examined global stablecoin initiatives—cryptocurrencies that are pegged to, or backed by, a fiat currency. Most popular amongst global stablecoin initiatives is Libra, the digital currency project being developed by the Facebook-led Libra Association, that is due to be released sometime in the second half of next year. 

Though each stablecoin will be judged on its own individual merits, the conclusion means IOSCO Principles and Standards “may apply to stablecoins depending on how they are structured, including those related to disclosure, registration, reporting and liability for sponsors and distributors,” said Ashley Alder, Chair of the IOSCO Board.

The implications are broad. IOSCO’s members, who comprise of 34 securities regulators, including the U.S. SEC, regulate more than 95 percent of the world’s securities markets in over 115 jurisdictions. 

According to Alder’s statement, IOSCO “agree[s] with the recent G20 press release that global stablecoins with potential systemic footprints give rise to a set of serious public policy and regulatory risks.”

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And IOSCO acknowledges the recent G7 report, which identified how global stablecoins could pose a serious threat to central banks’ authority to determine monetary policy.

IOSCO’s position, it appears, mirrors that of the SEC, crypto’s toughest regulator, which recently launched enforcement actions against EOS issuer Block.One and Telegram. In March, the SEC’s Senior Advisor for Digital Assets, Valerie Szczepanik, said at Austin’s SXSW conference that some stablecoins “could raise issues under securities laws.”