How Might New Regulations Affect the Competitive Landscape of Stablecoin Issuers?

New, stringent regulations would likely consolidate the stablecoin market, favoring issuers with deep pockets and established compliance infrastructures (e.g. major financial institutions). Small, less-capitalized issuers, especially those with experimental or opaque reserve models, would struggle to meet the high capital, audit, and disclosure requirements, forcing them out of the market.

This would lead to a reduction in the number of stablecoins, concentrating market share among a few highly regulated and transparent players.