What the financial regulators are saying and feeling

1. “Yes, we know stablecoins will have one hundred percent reserves, but we are not sure we can regulate that system into a position of safety.”

2. “Well, the rest of the financial system has nothing like one hundred percent reserves, but don’t worry we have everything there under control.”

The hole is large enough to drive a truck through.  Keep this contrast in mind, because you will be hearing it, expressed in other terms of course, hundreds of times over the next year or so.