Moody’s Proposes New Credit Rating System for Stablecoins

Moody’s plans to rate stablecoins by analyzing reserve asset quality, maturity risk and counterparties, not just the dollar peg.

The framework requires strict reserve segregation so assets serve only stablecoin holders, even during issuer bankruptcy.

The proposal aligns with rising regulation like the GENIUS Act and is open for public feedback until January 26, 2026.

Moody’s announced on Friday, December 12, a proposal to formally rate stablecoins as digital assets enter traditional finance. The plan, released in the United States, outlines how Moody’s would assess stablecoin obligations and reserves. The agency said it acted to address growing institutional use and rising regulatory focus on stablecoins.

How Moody’s Plans to Assess Stablecoins

Notably, Moody’s said it would begin by reviewing each asset type backing a stablecoin. The agency plans to evaluate credit quality using asset ratings and related counterparties. Therefore, two U.S. dollar stablecoins claiming full backing could receive different ratings. The distinction depends on reserve composition, not the peg itself.

However, Moody’s added a second layer focused on market value risk. This step measures risk based on asset type and maturity length. According to Moody’s, this process would create advance rates applied to each reserve asset. In addition, the agency said it would review operational, liquidity, and technology risks. These factors together would determine the final stablecoin rating.

Reserve Segregation and Global Methodology

Following this structure, Moody’s said it would apply its cross-sector rating methodology. The approach targets stablecoins with operations separated from other issuer activities. Moody’s defined these holdings as reserve assets. Effective segregation means these assets only meet stablecoin obligations. This rule applies even during issuer or affiliate bankruptcy.

Moreover, Moody’s stated the framework would apply globally. The agency confirmed it opened the proposal for public feedback. Market participants have until January 26, 2026, to submit comments. This consultation period follows the detailed proposal released on Friday.

Tether, Regulation and Market Context

Meanwhile, reports noted Tether previously faced scrutiny over reserve transparency. In response, the company took steps to reassure markets. Tether also confirmed plans to launch a U.S.-focused stablecoin. In October, Tether reported about $135 billion invested in U.S. Treasuries.

Separately, the GENIUS Act recently established a federal framework for U.S. payment stablecoins. According to sources, the law requires highly liquid reserves. These include insured bank deposits and U.S. Treasury bills. Analysts cited these assets as benchmarks when discussing Moody’s proposed framework.

The post Moody’s Proposes New Credit Rating System for Stablecoins appears on Crypto Front News. Visit our website to read more interesting articles about cryptocurrency, blockchain technology, and digital assets.