The Crypto Roundup: 13 December 2023 | CryptoCompare.com

S&P Global has unveiled a new stablecoin stability assessment used to rate eight leading stablecoins. None of the rated stablecoins achieved the highest rating, while two were marked with the lowest rating.

The company’s assessment focuses primarily on each stablecoin’s effectiveness in maintaining its peg to fiat currencies through a process that starts with an analysis of asset quality risks. It then considers various risk mitigation factors, followed by an examination of governance, legal and regulatory framework, redeemability and liquidity, technological aspects, third-party dependencies, and historical performance.

In this inaugural rating, Gemini Dollar (GUSD), Pax Dollar (USDP), and USDC, stood out with a rating of 2 (strong), the best rating awarded. Both GUSD and USDP operate under the regulatory oversight of the New York State Department of Financial Services.

In contrast, leading stablecoin Tether received a rating of 4 (constrained). The rating reflects concerns about the transparency of its assets. On the lower end came TrueUSD and FRAX, which received a rating of 5 (weak), primarily due to insufficient information disclosure and reliance on an algorithm, respectively.

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• Source: https://www.cryptocompare.com/email-updates/daily/2023/dec/13/