LONDON—Existing securities rules could apply to "stablecoin" digital currency initiatives such as Facebook's Libra project to help realize its benefits as policymakers examine whether new regulation is needed, according to the global securities watchdog, the International Organization of Securities Commissions (IOSCO).
The organization, made up of securities regulators from across the world, including the United States, Europe and Japan, said an assessment of stablecoins found they can potentially offer benefits as well as pose risks, Economic Times reported.
Libra would be pegged to bank deposits and government securities across several currencies such as the dollar and euro.
Nonetheless, as CUToday.info has reported, Facebook's plans to launch Libra have raised concerns ranging from consumer protection to money laundering and even the notion that the traditional monetary system could be disrupted.
"Our analysis has shown that so-called ‘stablecoins’ can include features that are typical of regulated securities," IOSCO chair Ashley Alder said in a statement.
This means that existing securities rules on disclosures, registration and reporting may apply, Economic Times noted.