Issuance Licensing and Authorization Frameworks

Regulator-Grade Guidance Document

Date: June 2026 Domain: Stablecoin Regulations and License Regimes Section: Issuance Licensing and Authorization Audience: National regulators and policymakers

1. Global Landscape of Licensing Models

Across the 18 jurisdictions studied, stablecoin issuance licensing falls into six distinct model types. Each reflects a different regulatory philosophy regarding who should be permitted to issue tokens that function as money substitutes, what institutional safeguards are required, and how existing financial regulation should be adapted or replaced. This section organizes the global landscape by model type rather than geography, enabling policymakers to identify the approach most suited to their domestic context.

1.1 Bank-Only Model

Core principle: Stablecoin issuance is restricted to entities already holding banking or equivalent financial institution licenses, on the rationale that only prudentially supervised deposit-takers possess the governance, capital, and risk management infrastructure to safely issue money-like instruments.

Japan (Strictest Implementation)

Japan operates the most restrictive bank-only model globally. Under the Payment Services Act (PSA) (Act No. 59 of 2009, as amended 2022 and 2025), fiat-backed, par-redeemable stablecoins are classified as Electronic Payment Instruments (EPIs) under Article 2(5) (four EPI sub-types, I–IV) and may only be issued by three categories of regulated financial institutions:

1. Banks (deposit-type stablecoins) -- Licensed under the Banking Act, with full prudential supervision and deposit insurance coverage up to JPY 10 million per depositor per bank under the Deposit Insurance Act.
2. Fund Transfer Service Providers -- Registered under the PSA's fund transfer provisions. Three sub-categories apply: Type I (over JPY 1 million per transaction), Type II (up to JPY 1 million), and Type III (up to JPY 50,000), each with distinct capital and compliance requirements.
3. Trust Companies (trust-type stablecoins) -- Licensed under the Trust Business Act, with trust structures providing bankruptcy-remote asset segregation.

No other entity type may issue fiat-backed stablecoins to Japanese residents. The EPI framework has been operational since 1 June 2023. The PSA Amendment Act 2025 (enacted 6 June 2025, promulgated 13 June 2025 as Act No. 66) takes effect on 1 June 2026 -- a single enforcement date set by the FSA Cabinet Order published 22 May 2026. It relaxes reserve requirements for trust-type issuers, permitting a minimum of 50% of backing assets in short-term (≤3-month) JGBs/US Treasuries or early-terminable time deposits (previously 100% demand deposits), and strengthens recovery for Japanese users through FSA domestic asset-holding orders.

Intermediary registration is separately required: Electronic Payment Instruments Exchange Service Providers (EPIESPs) must register with the FSA, maintaining minimum capital of JPY 10 million and positive net assets at all times.

Market outcome: SBI VC Trade became the first registered EPIESP (March 2025) for USDC distribution (full USDC distribution launched 26 March 2025). JPYC Inc. registered as a fund transfer service provider in August 2025 and launched JPYC -- Japan's first regulated yen-denominated stablecoin (100% reserves; Ethereum, Polygon, Avalanche) -- on 27 October 2025; cumulative JPYC issuance surpassed JPY 2.1 billion by mid-April 2026. On 10 April 2026 the Cabinet approved a FIEA amendment bill reclassifying crypto-assets as financial instruments while leaving stablecoins under the PSA.

Sources:

• Chambers Blockchain 2025 -- Japan
• TKI Law -- Regulatory Landscape for Stablecoins
• Crypto for Innovation -- Japan FSA Policy Brief

South Korea (DABA Pending)

South Korea's Bank of Korea (BOK) advocates that won-stablecoin issuance be bank-led, while the ruling Democratic Party and the fintech industry argue for broader eligibility. The Digital Asset Basic Act (DABA / General Act on Digital Assets) -- which would classify stablecoins as "asset-linked digital assets" and create an FSC authorization regime requiring 100%+ reserves and guaranteed redemption -- remains a pending bill, not enacted law. It was introduced to the National Assembly on 10 June 2025 by Rep. Min Byung-deok (DPK), and the ruling party re-proposed/consolidated a version with bank-style stablecoin rules on 8 April 2026. The bill was left off the National Policy Committee's final pre-recess agenda (12 May 2026), pushing review past the 3 June 2026 local elections into H2 2026. The draft contemplates KRW 500 million (~USD 360,000) minimum paid-in capital, but no stablecoin-specific licenses have been issued. The country's baseline crypto consumer-protection law, the Virtual Asset Users Protection Act (VAUPA), took effect 19 July 2024.

Sources:

• CoinDesk -- South Korea's Long-Awaited Crypto Law Stalls Over Who Can Issue Stablecoins

Switzerland (Banking License or Exemption)

Switzerland integrates stablecoins into existing financial market law under FINMA's "same business, same risks, same rules" approach, with no stablecoin-specific statute. When a fiat-backed stablecoin is redeemable at a fixed value, the funds received are typically treated as public deposits, triggering deposit-taking regulation under the Banking Act. Issuers must obtain either a full banking license, a FinTech license (Art. 1b BankA; deposits up to CHF 100 million, uninvested and non-interest-bearing), or rely on a bank default-guarantee exemption under Article 5(3)(f) of the Banking Ordinance. FINMA Guidance 06/2024 (26 July 2024) established minimum requirements for such guarantees, including full coverage of all stablecoin-holder claims, individual customer claims against the guaranteeing bank, and uncomplicated, rapid exercise.

Proposed FinIA amendments (consultation opened 22 October 2025, closed 6 February 2026) would create a dedicated Payment Institution license category, reserving "Regulated Stablecoin" issuance exclusively to such institutions, with banks required to use a separate legal entity. As of June 2026 the FinIA dispatch to Parliament is expected H2 2026 at the earliest, with entry into force projected for late 2026/2027; the reform is not yet enacted.

Sources:

• FINMA -- Guidance 06/2024 on Stablecoins
• Loyens & Loeff -- FinIA Reform: New Licences
• Deloitte Switzerland -- Regulatory Update: New Rules on Payment Tokens

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1.2 Dedicated Stablecoin License

Core principle: A bespoke licensing category is created specifically for stablecoin issuance, separate from banking, e-money, or general crypto-asset licenses. This is the fastest-growing model globally and represents the regulatory frontier.

European Union -- MiCA ART/EMT Authorization

The

EU's Markets in Crypto-Assets Regulation (MiCA) (Regulation (EU) 2023/1114; in force 29 June 2023, stablecoin Titles III/IV applicable from 30 June 2024) is the most comprehensive enacted stablecoin framework globally. It creates two distinct authorization tracks:

• Electronic Money Tokens (EMTs) -- Article 48: May only be issued by credit institutions (CRD-authorized) or electronic money institutions (EMD2-authorized). Issuers must submit a crypto-asset white paper to their competent authority. EMTs referencing a single official currency function as e-money under MiCA.
• Asset-Referenced Tokens (ARTs) -- Articles 16-21: Any legal person established in the EU may apply for authorization. Credit institutions benefit from a simplified regime (notification plus white paper, no separate ART authorization).

Capital requirements (Article 35): ART issuers must maintain own funds at the highest of: EUR 350,000 minimum; 2% of average reserve assets (up to 3% for significant ARTs); or 25% of prior-year fixed overheads. EMT/EMI issuers face a EUR 350,000 minimum.

Passporting: Upon authorization in one EU Member State, issuers may operate across all 27 EU Member States and the broader EEA.

Significance classification: ARTs/EMTs meeting at least three significance criteria (e.g., >10 million holders; >EUR 5 billion issued/market cap/reserve; >2.5 million daily transactions; >EUR 500 million daily transaction value) may be classified as "significant" and subject to direct EBA supervision with enhanced requirements (minimum 60% reserves in bank deposits, up to 3% own funds). Non-euro EMTs face Article 58 caps (issuance must cease if daily transaction value exceeds EUR 200 million or daily transactions exceed 1 million).

Sources:

• MiCA Full Text -- EUR-Lex
• EBA -- Asset-Referenced and E-Money Tokens (MiCA)
• Dechert -- MiCA Phase 1

Singapore -- MAS Single-Currency Stablecoin (SCS) Framework

Singapore's MAS finalized its SCS framework as a policy position on 15 August 2023. As of June 2026, formal legislative codification of the SCS framework has not yet been enacted and remains expected mid-2026. The framework creates a privileged "MAS-regulated stablecoin" designation layered on top of the existing Payment Services Act 2019 DPT regime.

Eligibility: Major Payment Institution (MPI) license required. SCS must be pegged to SGD or a single G10 currency, issued solely from Singapore. Banks are covered regardless of circulation; non-bank issuers must exceed S$5 million in circulation.

Capital requirements: Minimum base capital at the higher of S$1 million or 50% of annual operating expenses.

Business restrictions: SCS issuers are prohibited from lending, staking, dealing in other DPTs, fund management, or investing in other entities.

Licensed issuers: Paxos (full MPI license 1 July 2024; launched USDG/Global Dollar from Singapore November 2024), StraitsX (XSGD/XUSD, MPI licenses July 2024). Ripple expanded its MPI license scope to RLUSD in December 2025 (not under the SCS framework).

Sources:

• MAS -- Finalises Stablecoin Regulatory Framework (15 August 2023)
• Morgan Lewis -- MAS Finalises Stablecoin Regulatory Framework

Hong Kong -- Stablecoins Ordinance (Cap. 656)

Hong Kong's Legislative Council passed the Stablecoins Ordinance (Cap. 656) on 21 May 2025 (gazetted 30 May 2025), effective 1 August 2025. It creates a dedicated HKMA licensing regime for fiat-referenced stablecoin (FRS) issuers.

Scope: Three activities trigger licensing -- issuing FRS in Hong Kong, issuing HKD-linked FRS outside Hong Kong, or actively marketing FRS to the Hong Kong public.

Requirements: HK$25 million minimum paid-up capital (approximately US$3.2 million); Hong Kong incorporation (or an authorized institution incorporated outside Hong Kong); chief executive, directors, stablecoin manager, and controller Hong Kong-based with fitness, propriety, and expertise; and a viable business plan with concrete use cases.

Market development: Following an initial application deadline of 30 September 2025 (31 October 2025 for pre-existing issuers), the HKMA granted the first two issuer licences on 10 April 2026 -- Anchorpoint Financial (FRS01) and HSBC (FRS02), both HKD-referenced -- out of 36 formal applications. OSL was not in the first batch.

Sources:

• Davis Polk -- Hong Kong's Licensing and Regulatory Framework for Stablecoins
• Morgan Lewis -- Hong Kong Stablecoin Ordinance Takes Effect August 2025
• HKMA -- Regulatory Regime for Stablecoin Issuers

United Kingdom -- FCA Authorization (Forthcoming)

The

UK is building a dual-regulator model under the Financial Services and Markets Act 2023. The FSMA 2000 (Cryptoassets) Regulations 2026 were made by Parliament on 4 February 2026. The FCA will authorize all stablecoin issuers (per CP25/14, published 28 May 2025), with a UK-establishment requirement that prevents offshore issuers from obtaining authorization. The Bank of England will impose enhanced requirements on systemically important issuers once recognized by HM Treasury. Earlier BoE proposals (November 2025) included at least 40% of backing assets at the BoE and individual holding limits of GBP 20,000; as of May 2026 the BoE is revising the backing requirement downward and abandoning individual holding limits in favour of temporary aggregate issuance caps, and signalling that banks may issue via non-deposit-taking subsidiaries. The application window runs 30 September 2026 – 28 February 2027, with the full regime commencing 25 October 2027.

Sources:

• FCA -- CP25/14: Stablecoin Issuance and Cryptoasset Custody
• Bank of England -- Proposed Regulatory Regime for Systemic Stablecoins

Bahrain -- CBB Stablecoin Issuance and Offering (SIO) Module

Bahrain's CBB issued the Stablecoin Issuance and Offering (SIO) Module (CBB Rulebook Volume 6) effective 2 July 2025 as a dedicated stablecoin licensing framework. Requirements: locally incorporated Bahraini Joint Stock Company; BHD 250,000 minimum paid-up capital (approximately USD 663,000); a three-year track record in stablecoin issuance/crypto; and a 60-calendar-day decision timeline. Notably, Bahrain explicitly permits yield-bearing stablecoins, including Sharia-compliant reward structures -- a feature few jurisdictions globally allow. The CBB granted the first in-principle approval under the SIO Module to AX Coin (AlloyX Group / SOLOWIN HOLDINGS) on 28 January 2026, and the first full stablecoin issuer licence to AX Coin Bahrain B.S.C. (c) on 3 June 2026.

Sources:

• CBB -- Framework for Regulating Stablecoin Issuance
• Legal500 -- Stablecoins Find a Home: Bahrain

United States -- GENIUS Act Permitted Payment Stablecoin Issuers

The

United States enacted the GENIUS Act (S.1582) on 18 July 2025, classifying compliant payment stablecoins as neither securities nor commodities and creating three categories of Permitted Payment Stablecoin Issuers (PPSIs): (1) subsidiaries of insured depository institutions; (2) nonbank institutions supervised by the OCC; and (3) state-chartered entities under certified "substantially similar" state regimes. State-qualified issuers may operate under state regulation if consolidated outstanding issuance is $10 billion or less; above this they must notify the OCC within 5 days and transition to the federal framework within 360 days or cease net new issuance.

Critically, the Act is enacted but not yet effective: it takes effect on the earlier of 18 January 2027 or 120 days after final implementing rules, and no final rule had been issued as of June 2026. Implementing rulemaking advanced rapidly through Spring 2026: the OCC issued a comprehensive GENIUS Act NPRM on 25 February 2026 (setting a $5 million Tier 1 capital floor for de novo nonbank PPSIs in their first three years); the FDIC approved a prudential NPRM on 7 April 2026 (reserves, capital, custody, and a two-business-day redemption mandate, comments due 9 June 2026) and an illicit-finance NPRM on 22 May 2026; the NCUA proposed a stablecoin issuance rule on 11 February 2026; and Treasury (FinCEN + OFAC) issued a joint AML/CFT and sanctions-compliance NPRM on 8 April 2026. The OCC also conditionally approved five national trust bank charters (Circle, Ripple, BitGo, Fidelity Digital Assets, Paxos) on 12 December 2025, and Tether launched USAT -- a GENIUS-compliant stablecoin -- via Anchorage Digital Bank on 27 January 2026, coexisting with global USDT.

Sources:

• S.1582 -- Congress.gov
• Covington -- GENIUS Act Becomes Law
• Latham & Watkins -- GENIUS Act of 2025

Canada -- Stablecoin Act (Enacted, Not Yet in Force)

Canada's federal Stablecoin Act (Division 45, Part 5 of Bill C-15, tabled 4 November 2025) received Royal Assent on 26 March 2026 -- it is now enacted law but is not yet in force, with its in-force date to be set by Order in Council and the supporting framework anticipated in 2027. As of June 2026 no draft regulations had been published in the Canada Gazette. The Act requires non-prudentially-regulated issuers to register with the Bank of Canada (via inclusion on a public registry), mandates 1:1 reserves held by qualified custodians, prohibits yield payments to holders, and includes a National Security Review mechanism allowing the Minister of Finance to prohibit or restrict issuance by entities controlled from high-risk jurisdictions. The Bank of Canada has been allocated $10 million over two years for supervisory build-out. Federally regulated financial institutions, central banks/CBDCs, algorithmic/commodity-backed tokens, and closed-loop stablecoins are excluded. A parallel provincial securities overlay treats stablecoins as Value-Referenced Crypto Assets (VRCAs) under CSA Staff Notices 21-332/21-333.

Sources:

• Torys LLP -- Canada's Stablecoin Act
• Stikeman Elliott -- Newly Minted: Canada's Proposed Federal Stablecoin Act

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1.3 E-Money/Payments License Adaptation

Core principle: Existing electronic money or payments licensing frameworks are adapted to capture stablecoin issuance, treating stablecoins as a digital evolution of e-money rather than a fundamentally new product category.

Australia -- AFSL and Payments System Modernization

Australia classifies stablecoins as financial products (specifically, non-cash payment facilities) under the Corporations Act 2001 -- confirmed by ASIC's finalized INFO 225 (29 October 2025) -- requiring an Australian Financial Services License (AFSL). There is no dedicated stablecoin statute yet. Treasury released its Tranche 1 Payment Service Provider exposure-draft package (five bills) on 12 March 2026 (consultation closed 9 April 2026, not yet enacted), which would require major single-currency stablecoin / stored-value-facility issuers above an aggregate-credit threshold currently proposed at A$200 million to register with APRA and comply with APRA prudential standards (registration, not full ADI/bank licensing), with proposed 1:1 backing in high-quality liquid assets.

ASIC adopted a no-action position until 30 June 2026 (by which date issuers must lodge AFSL applications) and a class exemption (Instrument 2025/631, September 2025) allowing intermediaries distributing Australian-issued stablecoins to operate without separate licensing, with relief until 1 June 2028.

Sources:

• Allens -- The Rise of Stablecoins: Australian Regulatory Developments
• Gilbert + Tobin -- ASIC Information Sheet 225

Brazil -- SPSAV Authorization via FX Framework

Brazil's BCB operationalized Law 14,478/2022 through Resolutions 519, 520, and 521 (November 2025) plus Instruction 701/2026, with the framework taking effect 2 February 2026 and classifying fiat-referenced stablecoin transactions as foreign exchange (FX) operations (Resolution 521). Entities must obtain authorization as SPSAVs (Sociedade Prestadora de Serviços de Ativos Virtuais). Capital requirements range from R$10.8 million to R$37.2 million (approximately US$2M-$7M) depending on activity type. Eligible authorized financial institutions may operate by notifying the BCB; non-bank VASPs must apply for full SPSAV authorization. Existing VASPs have a 270-day grandfathering period (ending ~30 October 2026) to notify/apply/migrate. Algorithmic stablecoins are banned, and Resolution 561/2026 (effective 1 October 2026) prohibits virtual-asset settlement of the offshore leg of regulated eFX cross-border payments. There is no standalone statutory reserve-composition regime; proof-of-reserves is certified via Instruction 701/2026.

Sources:

• Chainalysis -- Breaking Down Brazil's New Crypto Framework
• CoinDesk -- Brazil Central Bank Sets Crypto Rules

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1.4 General Crypto/VASP License

Core principle: Stablecoins are regulated under broader crypto-asset or virtual asset service provider licensing frameworks without a stablecoin-specific module.

UAE -- Multi-Authority VASP Framework with Stablecoin Overlay

The

UAE operates a five-authority model (CBUAE, VARA, ADGM/FSRA, DFSA/DIFC, and CMA -- which replaced the SCA in 2026). CBUAE has exclusive jurisdiction over dirham-pegged Payment Tokens under the Payment Token Services Regulation (PTSR) (issued 7 June 2024, effective 6 July 2024), requiring AED 15 million minimum capital plus 0.5% of outstanding face value (2% for bank subsidiaries) for licensed Dirham Payment Token issuers, with 100% reserve backing, daily reconciliation, and next-business-day redemption. VARA (Dubai) regulates non-dirham Fiat-Referenced Virtual Assets under its Issuance Rulebook v2.0, requiring AED 10 million regulatory capital. ADGM/FSRA (Abu Dhabi) regulates Fiat-Referenced Tokens, requiring USD 2 million minimum capital. Algorithmic stablecoins and privacy tokens are strictly prohibited UAE-wide. Live AED stablecoins now include AE Coin (at point-of-sale since January 2026), Zand AED, and the IHC/Sirius/FAB DDSC.

Sources:

• CBUAE Rulebook -- Payment Token Services Regulation
• Chambers -- Blockchain 2025: UAE

Bermuda -- DABA Licensing with SCPS Overlay

Bermuda's Digital Asset Business Act 2018 (DABA) provides a general licensing framework with three tiers: Class T (testing, 3-12 months), Class M (modified, transitional, ~12 months), and Class F (full, perpetual). The BMA layered stablecoin-specific requirements through the SCPS Guidance (finalized November 2024) for Single Currency Pegged Stablecoin Issuers, requiring 100% value parity, bankruptcy-remote reserve structures, independent attestation, stress testing, and recovery/resolution planning. Circle received BMA approval to issue USYC and offer Circle Mint accounts from Bermuda (early 2025). A proposed Payment Services Act would add a payments track. The government is also piloting USDC payments and pursuing a sovereign-grade "Bermuda Digital Dollar" via a Stellar Development Foundation partnership announced May 2026.

Sources:

• BMA -- Digital Asset Business
• Chambers -- Blockchain 2025: Bermuda

Turkey -- CMB CASP Licensing (Trading/Custody Only)

Turkey's Law No. 7518 (published 2 July 2024) establishes CASP licensing through the Capital Markets Board (CMB/SPK) for platform operators (TRY 100 million minimum capital, ~USD 2.8M) and custody-only providers (TRY 50 million, ~USD 1.4M), with CMB Communiqués III-35/B.1 and III-35/B.2 (13 March 2025). However, Turkey has no domestic stablecoin issuance framework -- regulation addresses only trading and custody of foreign-issued stablecoins. Stablecoin payments are banned under the CBRT's April 2021 regulation. MASAK Circular No. 29 (28 June 2025) imposes stablecoin-specific transfer limits (USD 3,000 daily, USD 50,000 monthly) to manage capital-flight risks. Incumbent CASPs must obtain a CMB operating licence by 30 June 2026 or wind down. A proposed 10% crypto income tax was withdrawn from an omnibus bill on 28 March 2026.

Sources:

• Legal 500 -- The Legal Regime of Crypto Assets in Turkey
• Chambers -- Blockchain 2025: Turkey

Nigeria -- SEC VASP Licensing

Nigeria's Investments and Securities Act (ISA) 2025 (enacted 31 March 2025) expanded the securities definition to include digital assets, requiring stablecoin issuers to register as VASPs with the SEC and to register both their tokens and offerings (mapping to the relevant activity category, e.g., DAOP). Under SEC Circular No. 26-1 (16 January 2026), Digital Asset Exchanges and Custodians must maintain NGN 2 billion paid-up capital (~USD 1.4M) and DAOP/RATOP operators NGN 1 billion, with a Fidelity Insurance Bond of at least 25% of paid-up capital; the revised capital-compliance deadline is 30 June 2027. Nigeria's regulated naira-backed stablecoin, cNGN (1:1 peg), launched in February 2025 under joint SEC/CBN supervision; its issuer (WrappedCBDC) was admitted to test under the SEC's Regulatory Incubation / Accelerated Regulatory Incubation Programme (RI/ARIP) track on 29 August 2024 -- a provisional test admission, not a full Approval-in-Principle (AIP).

Sources:

• Chambers -- Blockchain 2025: Nigeria
• Ledger Insights -- cNGN Launch

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1.5 Securities Regulation Path

Core principle: Stablecoins are classified or potentially classifiable as securities, subjecting issuers to securities registration, disclosure, and compliance requirements.

United States (Pre-GENIUS Act)

Before the GENIUS Act, the SEC maintained that certain stablecoins -- particularly yield-bearing or algorithmic tokens -- could constitute securities. SEC actions against Terraform Labs (whose UST/LUNA collapse led to a $4.47 billion settlement and to Do Kwon's 15-year federal prison sentence in December 2025), a Paxos Wells notice regarding BUSD (the investigation was terminated with no charges in July 2024), and enforcement threats against other issuers created significant regulatory uncertainty. The GENIUS Act resolved this by explicitly excluding compliant payment stablecoins from the definitions of "security" and "commodity." Algorithmic stablecoins remain outside the GENIUS Act and in a regulatory gray area (potential SEC/CFTC jurisdiction); an April 2025 SEC staff statement that "Covered Stablecoins" are not securities does not apply to algorithmic tokens.

Canada (Provincial Securities Framework)

The CSA classifies stablecoins as Value-Referenced Crypto Assets (VRCAs), considering them potentially securities and/or derivatives. Crypto Asset Trading Platforms (CTPs) may only list VRCAs if the issuer has filed a prescribed undertaking committing to 1:1 reserve maintenance (cash and cash equivalents under the CSA's fiat-backed crypto-asset criteria), monthly assurance reports, and audited annual financial statements. This provincial securities overlay operates alongside the newly enacted (but not-yet-in-force) federal Stablecoin Act.

Sources:

• CSA Staff Notice 21-333

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1.6 No Specific License Required

Core principle: Jurisdictions where stablecoin issuance does not require a specific license, either because regulation is absent, under development, or relies on general business law.

India

India has no stablecoin issuance licensing framework. Stablecoins are classified as Virtual Digital Assets (VDAs) under Section 2(47A) of the Income Tax Act 1961 for tax purposes (30% flat tax on gains under Section 115BBH, 1% TDS under Section 194S), and VDASPs must register with FIU-IND under the PMLA for AML/CFT compliance, but no entity is licensed to issue stablecoins. A proposed COINS Act 2025 (with a CARA authority) has not been enacted, and an inter-ministerial discussion paper was shelved again in April 2026 amid RBI resistance. The RBI's December 2025 Financial Stability Report concluded stablecoin "risks outweigh purported benefits" and urged global priority on CBDCs over private stablecoins; the e-rupee CBDC fell ~24% to Rs 771.7 crore in circulation (31 March 2026), with ~10 million users.

South Africa

South Africa licenses Crypto Asset Service Providers under the FAIS Act (300 of 512 applications approved by December 2025), but this covers only advisory/intermediary services. There is no stablecoin issuance-specific regulation -- no issuance rules, reserve requirements, stability oversight, or standardized redemption rights. Six ZAR-pegged stablecoin arrangements operate domestically without issuance-specific oversight. The IFWG's Stablecoin Landscape Diagnostic (November 2025) and a Q1 2026 IFWG Discussion Paper on rand-pegged stablecoin frameworks explicitly identified these gaps (comments due 18 May 2026), and a SARB/FSCA Joint Communication (28 May 2026) confirmed crypto/stablecoins are not "money," "funds," or "payments" under the NPSA 1998 and are not legal tender.

Sources:

• IFWG -- Mind the Stablecoin Gap
• SARB Financial Stability Review, November 2025

2. Comparative Analysis Table

3. What Works and What Doesn't

What Clearly Works (with evidence)

1. Dedicated stablecoin licensing with clear requirements

Jurisdictions that created purpose-built stablecoin licensing frameworks have attracted the most compliant issuers and institutional participants.

• Singapore: In-principle approvals went to StraitsX and Paxos at the Singapore FinTech Festival in November 2023; Paxos received the first full MPI license on 1 July 2024, and StraitsX in July 2024. The "MAS-regulated stablecoin" label provides a clear market signal that distinguishes regulated instruments from unregulated tokens. The Global Dollar (USDG), launched from Singapore in November 2024, attracted institutional partners.
• Hong Kong: The Stablecoins Ordinance (Cap. 656) drew 36 formal applications, and the HKMA granted the first two issuer licences on 10 April 2026 -- to Anchorpoint Financial (FRS01) and HSBC (FRS02), both HKD-referenced -- signaling that institutional credibility follows regulatory clarity.
• Bahrain: The SIO Module's unique permission for yield-bearing (including Sharia-compliant) stablecoins differentiated Bahrain from competitors; the CBB granted an in-principle approval to AX Coin in January 2026 and the first full issuer licence in June 2026.

2. Tiered regulatory approach based on issuance volume or systemic importance

• United States (GENIUS Act): The $10 billion threshold for state-versus-federal oversight creates proportionate regulation. Small issuers can operate under state regimes (with "substantially similar" certification), while large issuers face federal standards. This directly addresses the complaint that uniform regulation crushes small innovators.
• Australia: The proposed ~A$200 million APRA registration threshold (Tranche 1 exposure draft, March 2026) separates small issuers (AFSL, lighter oversight) from major ones (APRA prudential standards), without imposing full ADI/bank licensing.
• EU MiCA: The "significance" classification for ARTs/EMTs (triggered by meeting at least three quantitative criteria) escalates requirements for tokens that pose systemic risk, without burdening smaller issuers. Significant tokens face direct EBA supervision and a 60% bank-deposit minimum (versus 30% for non-significant).
• UK: The FCA/BoE dual model assigns systemic stablecoins to BoE supervision with enhanced requirements (reserve allocation at the BoE, plus -- as of May 2026 -- aggregate issuance caps in place of individual holding limits), while non-systemic issuers face lighter FCA rules.

3. Regulatory sandbox-to-license pathway

• Bermuda: The Class T (testing) to Class M (modified) to Class F (full) pipeline has functioned effectively since 2018, with 40+ firms now licensed. Circle operates from Bermuda under a DABA license.
• Hong Kong: The HKMA stablecoin sandbox (launched March 2024) provided a structured transition. Five participants -- Standard Chartered, Animoca, JD Coinlink, RD InnoTech, and HKT -- tested use cases before the Ordinance took effect.
• Bahrain: The CBB's in-principle-approval pathway under the SIO Module enables innovation testing before full licensing (AX Coin progressed from IPA in January 2026 to a full licence in June 2026).
• Nigeria: The SEC's RI/ARIP track provided provisional test admission for early entrants, including the cNGN issuer (admitted 29 August 2024).

4. Explicit exclusion of stablecoins from securities/commodity classification

• United States: The GENIUS Act's explicit carve-out resolved years of regulatory ambiguity. Compliant payment stablecoins are neither securities nor commodities, eliminating SEC and CFTC jurisdictional claims (a March 2026 SEC-CFTC MOU further harmonized digital-asset jurisdiction).
• Japan: The EPI classification creates a purpose-built legal category distinct from both crypto-assets and securities, providing unambiguous regulatory treatment; the April 2026 FIEA amendment bill confirmed stablecoins remain under the PSA even as other crypto-assets move toward financial-instrument status.

What Clearly Doesn't Work (with evidence)

1. Regulatory ambiguity and multi-agency turf disputes

• United States (pre-GENIUS Act): Before July 2025, the SEC, CFTC, OCC, Federal Reserve, FDIC, and 50 state regulators all claimed some jurisdiction over stablecoins without clear delineation. The SEC issued a Wells notice to Paxos over BUSD while the OCC simultaneously encouraged bank stablecoin activities. This contradiction drove issuers to Bermuda, Singapore, and the UAE. The GENIUS Act resolved this, but the US lost years of competitive positioning -- and, because the Act is enacted but not yet effective pending final rules, issuers still operate in a transitional gap into 2026.
• South Korea: The bank-versus-fintech dispute over who should issue stablecoins has prevented DABA from being passed at all -- the bill, introduced June 2025 and re-proposed April 2026, was pushed past the June 2026 local elections into H2 2026, and no stablecoin-specific licenses exist.

2. Overly restrictive bank-only requirements

• Japan's initial framework: The original requirement that trust-type stablecoin reserves be held 100% in demand deposits made issuance economically unviable -- issuers could earn no yield on reserves. The 2025 amendment (effective 1 June 2026) relaxing this to a minimum of 50% in short-term government bonds was a direct response to market feedback. Even so, Japan's bank-centric model has limited participation to a small number of institutions.
• South Korea (proposed): The BOK's insistence on bank-led issuance is actively blocking the entire regulatory framework from becoming operational, as the fintech sector and political opposition view this as anti-competitive.

3. Absence of stablecoin-specific regulation when significant adoption exists

• India: Despite ranking among the highest globally for crypto adoption, India has no stablecoin issuance framework, no reserve requirements, no redemption protections, and punitive taxation (30% + 1% TDS, retained unchanged in the 2026 Union Budget). The RBI opposes private stablecoins, and the e-rupee CBDC circulation actually fell ~24% to Rs 771.7 crore as of 31 March 2026.
• South Africa: Stablecoin usage has grown sharply, yet no issuance-specific regulation exists; the SARB classified crypto/stablecoins as a material financial-stability risk in its November 2025 Financial Stability Review, and the IFWG's diagnostic and 2026 discussion paper confirmed the gaps remain unfilled.
• Turkey: Despite very large USDT-TRY trading volumes and tens of millions of crypto users, Turkey has no domestic stablecoin issuance framework and bans stablecoin payments.

4. Delayed implementation creating extended uncertainty

• United Kingdom: Despite FSMA 2023 receiving Royal Assent in June 2023, the stablecoin regime will not be fully operational until 25 October 2027 -- over four years later. During this period, the UK has fallen behind the EU (MiCA applicable since June/December 2024), Singapore, Hong Kong, and Japan in establishing an operational licensing regime.
• Canada: The Stablecoin Act received Royal Assent on 26 March 2026 but is not yet in force (awaiting an Order in Council), with draft regulations not yet published and the operational framework not anticipated before 2027 -- an enacted-but-dormant statute leaving issuers without an operational pathway.

Mixed Results

1. FX-integration approach (Brazil)

Brazil's classification of stablecoin transactions as foreign-exchange operations is administratively efficient -- it integrates stablecoins into an existing enforcement architecture. However, it does not establish a standalone statutory reserve-composition regime, redemption rights, or issuer governance standards comparable to MiCA or Singapore's SCS framework, relying instead on Instruction 701/2026 proof-of-reserves certification. Per-transaction FX caps (USD 100,000 for non-bank SPSAVs; USD 500,000 for banks) may constrain institutional adoption.

2. Multi-authority model (UAE)

The UAE's five-authority system (CBUAE, VARA, ADGM/FSRA, DFSA/DIFC, CMA) provides multiple regulatory pathways and has attracted significant institutional participation, with several live AED stablecoins (AE Coin, Zand AED, IHC/Sirius/FAB DDSC). However, the absence of passporting between jurisdictions increases compliance costs, and the 2025-2026 federal reforms (Federal Decree Law No. 6 of 2025; CMA replacing the SCA) are still bedding in. The clear hierarchy for dirham stablecoins (exclusive CBUAE jurisdiction) has worked well.

4. Recommended Framework

Based on the evidence from 18 jurisdictions, the following three-tiered licensing framework is recommended for regulators designing stablecoin issuance regimes. Every threshold cites a real-world precedent.

Tier 1: Small Issuers -- Registration Only

Threshold: Outstanding stablecoin issuance below a defined monetary threshold.

Tier 2: Medium Issuers -- Standard License

Threshold: Outstanding issuance from USD 5 million to the systemic threshold.

Tier 3: Large/Significant Issuers -- Enhanced Prudential License

Threshold: Outstanding issuance exceeding the systemic threshold, or crossing volume/user metrics.

5. Decision Matrix

For regulators choosing between licensing approaches, the following decision matrix maps jurisdiction characteristics to recommended regulatory models.

If your country has an established banking sector with strong prudential supervision...

Consider: Bank-centric model with non-bank pathway (Japan model)

Because: Japan's restriction to banks, fund transfer providers, and trust companies leverages existing prudential infrastructure and produced JPYC as the first regulated yen stablecoin (October 2025). However, the 2025 amendment relaxing reserve requirements (effective 1 June 2026) demonstrates that the model requires calibration to avoid choking issuer economics.

Warning: If you also want fintech innovation, pair this with a lighter intermediary registration (Japan's EPIESP model) or a sandbox pathway (Bermuda/Hong Kong model). South Korea is a cautionary case: an unresolved bank-versus-fintech dispute has left its DABA bill unpassed and the regime non-operational.

If your country has a developed e-money or payments regulation framework...

Consider: E-money license adaptation (EU MiCA EMT model)

Because: The EU's decision to require EMT issuance through existing credit institutions or e-money institutions leveraged decades of prudential infrastructure. By July 2024, Circle had secured an EMI license in France for USDC/EURC issuance, demonstrating that the model can accommodate major global issuers. The passporting mechanism eliminated the need for country-by-country licensing across 27 Member States.

Warning: Be prepared for dual-licensing complexity. The EU discovered that EMT transfers also constitute payment services under PSD2 (EBA Opinion, June 2025; full PSD2 compliance required from 2 March 2026), requiring CASPs to obtain separate PSD2 authorization.

If your country wants to attract global stablecoin issuers and fintech innovation...

Consider: Dedicated stablecoin license with clear standards (Singapore SCS / Hong Kong Ordinance model)

Because: Singapore attracted Paxos (USDG) and StraitsX (XSGD/XUSD) within months of framework finalization. Hong Kong granted its first two FRS licences (Anchorpoint and HSBC) in April 2026. Clear requirements, reasonable capital thresholds, and explicit "regulated" labeling provide both regulatory certainty and market signaling that attract institutional participants.

Warning: Limit initial scope to single-currency fiat-backed stablecoins (as both Singapore and Hong Kong did). Algorithmic, multi-currency, and commodity-backed tokens present distinct risks that should be addressed separately or excluded initially.

If your country has significant existing stablecoin usage but no dedicated framework...

Consider: Rapid regulatory gap-fill with phased implementation (South Africa IFWG model for identification; Brazil FX integration model for immediate coverage)

Because: South Africa's IFWG Stablecoin Landscape Diagnostic (2025) and 2026 discussion paper provide a methodological template for identifying regulatory gaps when stablecoin usage outpaces regulation. Brazil's FX classification of stablecoin transactions provided immediate regulatory coverage without waiting for bespoke legislation. Turkey's MASAK Circular No. 29 (stablecoin transfer limits) demonstrates targeted interim measures.

Warning: Gap-filling measures should be explicitly temporary, with a clear timeline to dedicated legislation. Brazil's FX approach does not provide the consumer protections (standalone reserve requirements, statutory redemption rights) that dedicated frameworks offer.

If your country has limited institutional capacity or a small domestic market...

Consider: Sandbox-first approach with graduated licensing (Bermuda DABA / Bahrain SIO model)

Because: Bermuda's three-tier DABA licensing (Class T/M/F) has operated successfully since 2018, enabling over 40 firms to be licensed through a graduated pathway. Bahrain's SIO Module, with its BHD 250,000 capital requirement (approximately USD 663,000), sets an achievable bar for smaller markets while maintaining prudential standards -- the CBB granted its first full SIO licence (AX Coin Bahrain) in June 2026.

Warning: Pair with cross-border recognition mechanisms. Small-market frameworks are most effective when they enable operators to serve larger markets from a well-regulated base (as Bermuda has done with Circle's DABA license for global operations).

If your country prioritizes CBDC development over private stablecoins...

Consider: Parallel-track regulation allowing coexistence (Japan/Singapore model)

Avoid: De facto prohibition without explicit ban (India model)

Because: Japan's framework permits private stablecoins (JPYC; USDC via SBI VC Trade) alongside BOJ digital-yen research, with the FSA confirming stablecoins remain under the PSA even as other crypto-assets move toward the FIEA. Singapore's wholesale-CBDC pilots and BLOOM initiative demonstrate that stablecoins serve as settlement infrastructure for institutional tokenization alongside CBDC development. By contrast, India's combination of heavy taxation (30% + 1% TDS), RBI opposition, and regulatory absence has not prevented stablecoin usage but has driven it into unregulated channels, while e-rupee circulation actually contracted in early 2026.

Verification Notes

This is a refresh synthesis (June 2026). All factual claims mirror the canonical per-jurisdiction fact matrix (stablecoin-fact-matrix.json), which consolidates the verified regulatory record across the 18 jurisdictions. No new web research was conducted for this pass; the corrections below reflect the matrix's current state of the law.

Key status corrections applied in this refresh:

1. Hong Kong Stablecoins Ordinance is Cap. 656 (corrected from Cap. 636). First two issuer licences granted 10 April 2026 -- Anchorpoint Financial (FRS01) and HSBC (FRS02), both HKD-referenced; OSL was not in the first batch (corrected from a prior statement that HSBC, Standard Chartered, and OSL would receive the first licences).

2. Canada's Stablecoin Act is enacted, not merely proposed -- Bill C-15 (Division 45) received Royal Assent on 26 March 2026 but is not yet in force (in-force date by Order in Council; draft regulations not yet in the Canada Gazette as of June 2026).

3. Japan's PSA Amendment Act 2025 takes effect on a single date, 1 June 2026 (corrected from any "13 June operational deadline" framing; 13 June 2025 is the promulgation date of Act No. 66, not an operational deadline). The base EPI framework has been operational since 1 June 2023.

4. United States GENIUS Act is enacted (18 July 2025) but not yet effective (earlier of 18 January 2027 or 120 days after final rules; no final rule as of June 2026). Implementing NPRMs advanced April–May 2026: OCC (25 Feb 2026), FDIC prudential (7 Apr 2026) and illicit-finance (22 May 2026), NCUA (11 Feb 2026), and Treasury FinCEN-OFAC joint (8 Apr 2026). Tether launched USAT (GENIUS-compliant) via Anchorage Digital Bank on 27 January 2026.

5. South Korea's DABA is a pending bill, not enacted -- introduced 10 June 2025, re-proposed/consolidated 8 April 2026, review pushed into H2 2026. VAUPA (the consumer-protection baseline) is in force since 19 July 2024.

6. Nigeria's cNGN issuer (WrappedCBDC) was admitted to test under the SEC's RI/ARIP track (29 August 2024) -- a provisional test admission, not a full Approval-in-Principle (AIP). Capital figures updated per SEC Circular No. 26-1 (16 January 2026): DAX/DAC NGN 2 billion; DAOP/RATOP NGN 1 billion.

7. Bahrain granted its first SIO in-principle approval (AX Coin, 28 January 2026) and first full stablecoin issuer licence (AX Coin Bahrain B.S.C. (c), 3 June 2026).

8. Singapore's SCS framework remains a policy position pending legislative codification (expected mid-2026, not yet enacted).

9. Switzerland's FinIA Payment Institution reform is proposed, not enacted (consultation closed 6 February 2026; dispatch to Parliament expected H2 2026 at the earliest).

10. Australia's dedicated regime is in exposure draft -- Tranche 1 PSP package released 12 March 2026 (consultation closed 9 April 2026), with a proposed ~A$200 million APRA registration threshold; stablecoins are currently regulated as financial products under the Corporations Act via AFSL.

Aggregate derivation: "18 jurisdictions" is recomputed from the matrix: United States, Bermuda, Brazil, Canada (Americas); Australia, Hong Kong, India, Japan, Singapore, South Korea (Asia-Pacific); European Union, Switzerland, Turkey, United Kingdom (Europe); Bahrain, Nigeria, South Africa, United Arab Emirates (Middle East & Africa).

Items requiring caution (per matrix):

• UK systemic-stablecoin parameters (reserve allocation at the BoE, holding limits) remain in flux -- the BoE is revising the backing requirement downward and replacing individual holding limits with temporary aggregate issuance caps (May 2026); CP25/14 Policy Statement expected Summer 2026.
• US implementing rules are at NPRM stage; specific capital and redemption figures (e.g., $5M OCC floor, FDIC T+2 redemption) are proposed, not final.
• Switzerland's FinIA Payment Institution reserve composition is not yet finalised.
• Australia's stablecoin-specific capital and audit cadence are to be set in subordinate regulations/APRA standards.

Sources

All sources cited inline. Primary references by jurisdiction:

• EU MiCA: EUR-Lex; EBA
• United States: Congress.gov S.1582; Covington; Latham & Watkins
• Singapore: MAS; Morgan Lewis
• Japan: Chambers Blockchain 2025; TKI Law
• Hong Kong: HKMA; Davis Polk
• United Kingdom: FCA CP25/14; Bank of England
• UAE: CBUAE Rulebook; Chambers Blockchain 2025 UAE
• Switzerland: FINMA Guidance 06/2024; Loyens & Loeff
• Canada: Torys LLP; Stikeman Elliott
• Bermuda: BMA; Chambers Blockchain 2025 Bermuda
• Bahrain: CBB; Legal500
• Brazil: Chainalysis; CoinDesk
• Australia: Allens
• South Korea: CoinDesk
• Turkey: Legal 500
• Nigeria: Chambers Blockchain 2025 Nigeria
• India: Global Legal Insights
• South Africa: IFWG; SARB via Moneyweb