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Moody’s Corporation is reportedly planning to develop a scoring system for stablecoins, per reporting from Bloomberg.
The scoring system will include up to 20 , analyzing the quality of each reserve's attestation.
The system will not reportedly be an official credit rating.
Stablecoins—which are cryptocurrencies intended to trade at an equal value to a non-digital asset, such as the U.S. dollar or gold—are the market's most-traded crypto asset, with a combined trading volume of $7.9 trillion in 2022.
Moody’s did not immediately respond to Decrypt’s request for comment.
Stablecoins and regulations
Moody’s scoring system comes at a time when regulators are taking a closer look at the stablecoin market, especially in the wake of Terra’s high-profile collapse last May.
The chairman of the Federal Deposit Insurance Corporation (FDIC) Martin Gruenberg said last October that “all payment stablecoin issuers should – just like banks, whether Federal or state-chartered, be subject to prudential regulation and oversight.”
Market leaders Tether and Circle have also ballooned over the past several years, cumulatively hitting a market capitalization of more than $100 billion.
Both stablecoin offerings, USDT and USDC, are backed by reserves in a variety of traditional financial assets.
"It’s a positive sign that an independent ratings firm sees the importance of scrutinizing whether payment stablecoins actually live up to their name in terms of being stable, well managed and transparent,” a Circle spokesperson told Decrypt via email.
As for Moody's scoring system, a Tether spokesperson told Decrypt that "it might bring more privacy, security, and confidentiality to crypto participants."