Overview

• Michael Barr said the statute permits reserve assets such as uninsured deposits, certain foreign instruments, and potential Bitcoin repo that could break one‑to‑one backing under stress.
• He cautioned that private money is prone to runs and that issuers may be unable to liquidate assets promptly at par during market turmoil.
• Barr urged tighter coordination between federal agencies and state regimes to avoid inconsistent enforcement and regulatory arbitrage.
• He acknowledged that stablecoins could improve payments efficiency if supported by credible, enforceable consumer protections and risk controls.
• Recent reporting cited IMF findings that stablecoin run dynamics could spill over into bank deposits and government bond markets, including U.S. Treasurys.