S&P Global - Third Party Evaluation of Stablecoins

so I'm Charles from SNP S&P as a credit trading agency or the S&P 500 uh I lead everything that is related to defi but also tokenization digital assets and and the like so let me see perfect so I want to touch on uh stable coin of course here but also and mainly on the assessment of stable coin and the product we launch and after that the end I'll touch on an exciting Next Step so as you probably already know stable coin had issue uh along the way some had deegs some totally collapsed because of those deegs so this is just um the list is not exhaustive but it's just a reminder of some of the big one in March one of the latest and and very relevant one was the usdc one where uh CLE was affected by the the issue of the Silicon Valley Bank so when we launch my team around almost 3 years ago we've been asked a lot to provide a visibility on the risk of stable coin after the collapse of uh us we of course we asked even more so we started to work on a product which I'll describe a bit here which is free and accessible to all I'll give you the link on the next slide and we started with uh eight stable coin which were the the biggest and something very important to remember is that um those reports are monitored so it's not a point in time evaluation it's something that is constantly looked at and we will continue to add more and more stable coin we added uh usdm in March and we're working a few more so with this QR code in case you want to get direct access to the report on the web page you can just use that or you just Google stable coin SNP uh and and you should find this uh fairly fast so what is it exactly first you need to understand that in um it's a bridge for trfi in defy in general for the stable coin trfi is used to have third party evaluation that are not part of any deal and and can be a trusted uh evaluation of risk it's focusing on dpeg so it's not a rating it's not probability of default it's a probability of dpeg and it's really meant to uh bring transparency on the weakness and the strengths of different stable coin hey yeah um I I'll go fast on this one because I I know everything's big behind I've been asked to to cut down a bit so this is something you can get from the link I was giving before and that's the actual methology of how the evaluation works so you might have seen in the news made a lot of news when we launch uh the the SSA stability stable Co stability assessment of usdt that they had uh a four so here you can see the different uh meaning of every uh score but first I explain the the flow so everything starts with the assets what are the asset what are the what is the credit risk of the asset Market risk all type of risk of the asset as as well as the mechanism for liquidation and uh the over colorization they have from that you'll have a first score which is from one to five one being the best five being the worst and that's just the score you have on your assets after that you have all the factors that you can see here all those factors so there governance legal uh liquidity third party dependency track record all those Factor can only bring you one notch down you cannot go higher you will just go down through that and then you'll have your final uh grade here you can see the score of every stable coin score so far with usdc Gemini and paxos at the top and true USD and fra at the bottom as you can see for instance something like uh true USD or usdc started a score and had a negative adjustment which is what I touched on just before and went one notch down something very interesting to uh and important to understand is the difference between the SSA and the scoring and rating a rating is something which is very heavily regulated it's solicited so you need to come to us and ask for rating uh the SSA is not it's unsolicited we decide when and on who we do uh a scoring and uh you like nobody really has uh a decision except us on that it's a priority of deeg not a priority of default it is free while rating is not and it's based only on Public Information that's something very interesting that leads to the the the part that I like the most which is once we launched this product we've been reached out by many many stable coin that do not exist yet some that are made by regions that want to have the regulated stable coin of their region uh back sometime by royal family there is many banks that told us we want to do this stable coin in our own currency or we want to do one bank said seven stable coins and well none of those can go into the SSA because the SSA like the stable coin stability assessment is only with public information but what they can all do and there's a lot of conversation with that uh with all those different entity is an actal rating so what I'm expecting uh and what we we're all already saying in my teams is that in the medium term most of the stable coin yield Bank stable coin tokenize treasury tokenize um money market fund different product with Bitcoin as a collateral tokenized clo will be rated and if you're working on that kind of project well you should come to me to discuss if your product your offering can be rated or not if you want a quicker access to the SSA you don't have to use necessarily only the link that I shared it's not integrated in RW XYZ on their stable coin page and it's also on on. xyc both L platform that have a focus on on stable coin if you want to contact me that's all my socials information the QR code is for linking which is what I'm using the most and I'll stop here and giving you some time back [Applause]