SEC Cuts Stablecoin Haircut to 2% — What It Means

The SEC issued guidance allowing broker-dealers to apply a 2% capital haircut to payment stablecoins, down from a punitive 100%. A haircut is the portion of an asset’s value that a firm cannot count toward deployable capital, serving as a buffer against market risk, and the earlier 100% treatment effectively made institutional crypto trading economically radioactive.

The Division of Trading and Markets published an FAQ saying staff would not object if a broker-dealer applied a 2% haircut on proprietary positions in payment stablecoins when calculating net capital. By cutting the penalty to 2% the SEC has given compliant stablecoins the same economic treatment as traditional money market funds.

“This is another terrific step in the right direction from our team in the Division of Trading and Markets to remove barriers and unlock access to on-chain markets,” SEC Chair Paul Atkins said. The shift rests on the new GENIUS Act, which requires 1:1 reserve backing and tighter anti-money-laundering controls.

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