Japan's financial regulator plans new restrictions on stablecoins - Nikkei

Japan's Financial Services Agency plans to propose legislation in 2022 to restrict issuance of stablecoins to banks and wire transfer companies, Nikkei reports. The liquidity crunch that China Evergrande (OTCPK:EGRNF) (OTCPK:EGRNY) is facing is also throwing some attention onto stablecoins' stability. For example, Tether (USDT-USD), the stablecoin with the biggest market cap, is backed partly by commercial paper, a form of short-term corporate debt. The company said in September that it doesn't hold any commercial paper or other debt issued by Evergrande (OTCPK:EGRNF). Still, that points to the risk that such debt could pose to stablecoin holders. Other stablecoins include USDCoin (USDC-USD) and TrueUSD (TUSD-USD). Limiting stablecoin issuance to wire transfer companies an banks, which are legally required to protect customer assets, would be a way to limit the risk for coin users, according to the FSA. The agency also intends to tighten regulations to fight money laundering by bringing