Regulated stablecoins:

❏ Have a government supervisor checking the issuer’s liquidity, compliance controls and cybersecurity risks

❏ Hold reserves in cash and short-term Treasuries

❏ Publish monthly reserve attestations from an independent accounting firm

❏ Keep reserves separate from the issuer’s own assets

❏ Give holders clear redemption rights

Unregulated stablecoins make similar promises with no authority holding them to it.

Sarah Breslow, Associate General Counsel at Paxos, on what sets regulated stablecoins apart: