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The US Securities and Exchange Commission (SEC) staff last week clarified that broker-dealers can apply a 2% “haircut” to their stablecoin holdings without objection from the SEC.
Previously, broker-dealers were uncertain whether to apply a 100% haircut to their dollar-pegged stablecoins, meaning that they did not count the tokens toward their net capital under existing regulations.
The clarification came in the form of a posting by the staff of the SEC’s Division of Trading and Markets as a “Frequently Asked Questions Relating to Crypto Asset Activities and Distributed Ledger Technology.”
In response, Commissioner Hester Peirce said: In my view, a 100% haircut would be unnecessarily punitive given the underlying reserve assets that back payment stablecoins.”
The SEC requires broker-dealers to maintain minimum levels of net capital to meet financial obligations and absorb potential losses from market downturns and volatility, according to the staff’s clarification.
The SEC’s response to frequently asked questions clarifying the 2% haircut rule for stablecoins held by broker-dealers. Source: SEC
For example, if a broker-dealer holds $100 million in stablecoins, a 2% haircut allows them to count $98 million toward their net capital requirements. Celebrating the clarification as positive for the financial system, Peirce said:
“Stablecoins are essential to transacting on blockchain rails. Using stablecoins will make it feasible for broker-dealers to engage in a broader range of business activities relating to tokenized securities and other crypto assets.”
The clarification means broker-dealers can hold stablecoins without worrying about excess net capital requirements, and can treat the tokens similarly to money market funds, vehicles that hold low-risk cash equivalents like US Treasurys and certificates of deposit.
In a social media post over the weekend, Marc Baumann, CEO of crypto intelligence company 51, called the SEC staff communication “a big deal,” adding that “Wall Street can now actually hold and use stablecoins without destroying their capital ratios.”
Stablecoins gain traction in the United States, but not all US officials are convinced
The stablecoin market cap recently hit a snag, falling by about $6 billion from the December 2025 peak of over $300 billion.
However, the market still has a $295 billion market cap, which has steadily grown since 2023, according to data from RWA.XYZ.
United States President Donald Trump signed the GENIUS stablecoin bill into law in July 2025, which was considered a landmark moment for the crypto industry.
President Trump signs the GENIUS bill into law. Source: Associated Press
The stablecoin market capitalization was just north of $252 billion at the time of signing and surged following the passage of the bill, according to data from RWA.XYZ.
Despite the meteoric surge in stablecoins and their implications for US dollar dominance in global financial markets, Neel Kashkari, president of the Federal Reserve Bank of Minneapolis, maintains that stablecoins and crypto have no real use cases.
“I could send any one of you $5 with Venmo, or PayPal, or Zelle, so what is it that this magical stablecoin can do? ” he said on Thursday.
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