SEC says some stablecoins could be treated as cash if guaranteed redemptions are in place.

SEC says some stablecoins could be treated as cash if guaranteed redemptions are in place.

The U.S. Securities and Exchange Commission (SEC) has issued interim guidance allowing certain U.S. dollar-backed stablecoins to be treated as cash equivalents on corporate balance sheets. This move is part of a broader initiative led by SEC Chair Paul Atkins to modernize cryptocurrency regulation.

The guidance, reported on Aug. 5 by Bloomberg Tax, applies only to fully backed, redeemable tokens with a 1:1 peg to the U.S. dollar. These stablecoins must meet strict criteria such as full backing by cash or Treasury bills and a guaranteed right to redemption. This makes the tokens similar in risk profile to traditional cash equivalents, excluding algorithmic stablecoins, yield-bearing tokens, or any asset not tied to the U.S. dollar.

The action is seen as a reversal of the SEC’s earlier, more restrictive policies. It seeks to eliminate one of the main accounting hurdles that kept traditional financial institutions from participating. The designation of qualifying stablecoins as cash equivalents may improve corporate reporting transparency and simplify how companies with crypto exposure manage their books.

The guidance complements the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act), which President Trump signed into law in July. The law requires reserve requirements and public audits, formally acknowledging regulated stablecoins as a new financial instrument that is not a security or a commodity. Firms like Circle (USDC) and Tether (USDT) now have a clearer regulatory path thanks to the law and the SEC’s guidance.

However, questions remain around the future treatment of more complex or international stablecoin models. Some analysts warn that redemption risk, transparency gaps, and illicit usage remain unresolved. The SEC acknowledged that the guidance is temporary and said further rulemaking is likely as part of its ongoing “Project Crypto” initiative, which aims to clarify digital asset classification and improve disclosure standards.

While not a full rule change, the guidance is seen as a meaningful step toward formal recognition of digital dollars in U.S. financial reporting. It aligns with global regulatory trends, including the European Union’s Markets in Crypto-Assets Regulation (MiCA) and the U.K.’s Financial Services and Markets Act 2023, which seek to establish comprehensive frameworks for digital assets.

References:
[1] https://crypto.news/sec-treat-stablecoins-cash-equivalents-2025/
[2] https://www.ainvest.com/news/sec-stablecoins-cash-equivalents-interim-guidance-2508/
[3] https://www.ainvest.com/news/bank-america-integrates-ripple-rlusd-modernize-payment-systems-2508-3/