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Moody’s is about to offer a stablecoin rating tool

The rating agency Moody’s seems to have turned its gaze to stablecoins. It would indeed work on a tool for rating cryptocurrencies indexed to other assets. This says a lot about the evolution of the sector, and the increased scrutiny of stablecoins.

Moody’s is developing a stablecoin rating tool

Moody’s financial ratings are particularly followed for States, but also for commercial companies. This arrival in the world of cryptocurrencies is therefore a clear development for one of the three largest global rating agencies. According to an anonymous source interviewed by our colleagues at Bloomberg, the rating system will take into account 20 stablecoins. Moody’s has yet to announce this initiative.

These are of course stablecoin reserves and their associated mechanisms which will be particularly analyzed by the rating agency. These can be “simple” reserves of an equivalent amount in fiat currency, or use more complex algorithmic mechanisms… And more controversial.

According to the source interviewed, Moody’s does not intend to make its tool an “official” notification. The agency already publishes ratings for companies in the crypto sector, like Coinbase.

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A proof of the growing interest in stablecoins

That a member of the “Big Three” is interested in a possible stablecoin rating is anything but trivial. This shows on the one hand growing interest from traditional financial institutions for the sector, especially the banks. For example, find out a few days ago about the launch of a stablecoin adopted to the Australian dollar, by one of Australia’s largest banking institutions.

This also shows that if this type of asset has the favor of players who have been reluctant until now, it is also closely monitored. The fall of the Terra (UST) ecosystem in 2022, and lingering doubts over the reserves of Tether’s largest stablecoin USDT, have fueled mistrust. Several politicians and decision makers have thus pointed the finger at stablecoins, accusing them of not being secure enough.

It is therefore this niche that Moody’s will occupy, by capitalizing on a craze for this type of asset, while providing a means of determining whether these are reliable and mitigating the risk to their users. This is one more indicator that stablecoins seem to be settling comfortably into the world of traditional finance.

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