S&P Global Ratings has released a Stability Rating for stablecoins USDC, USDT, DAI, FDUSD, FRAX, USDM, GUSD, USDP and TUSD.
In their research, analysts relied on the quality of the assets supporting the coin, which was measured by depository risks, as well as credit and market value. The degree of regulation, the issuer's business model, transparency, liquidity, repayment ability and technology used were also taken into account.
S&P Global Ratings identified 5 rating levels:
- Very strong
- Strong
- Adequate
- Limited
- Weak
In the above ranking, none of the listed assets was assigned the highest score. Why? Does this mean that stablecoins are not so stable after all?
The agency noted a lack of transparency and understanding of the risks associated with various stable coins. Although some of them carry a relatively low risk and are well backed by assets, some concerns remain.
Although stablecoins are designed to be stable, risks cannot be completely eliminated. Even projects such as USDC or GUSD that are rated "Strong" may experience situations where asset collateral or operations are under threat.
Therefore, not a single asset was assigned the highest rating. The agency wants to emphasize that complete stability is difficult to achieve, especially in such a young and rapidly developing industry as cryptocurrency. Any unexpected events could affect stablecoins.
Overall, this does not mean that stable coins are completely unstable. You just need to understand that certain risks are always present. Projects with clear and transparent rules are more likely to remain stable in the long term.