Brazil to Ban Algorithmic Stablecoins with New Legislation

Brazil is set to introduce legislation that prohibits algorithmic stablecoins, mandating that all stablecoins be fully backed by reserve assets. According to NS3.AI, the new regulations aim to enhance financial stability by imposing penalties on the issuance of unbacked stablecoins. This legislative move will directly affect algorithmic stablecoins like Ethena’s USDe, limiting their issuance in the market.