Table of Contents
In conversation with Beth Haddock
Compliance veteran Beth Haddock has spent twenty-five years where innovation meets regulation. In Part 1, she explains why "stablecoin" is one word doing far too many jobs, and why the GENIUS Act timeline makes that a problem worth solving now.
Beth Haddock is the Global Policy Lead at the Stablecoin Standard. She is also the founder of, Warburton Advisers and Chair of the Compliance Committee at GMO-Z.com Trust Company (NYDFS-regulated)
Beth Haddock has spent twenty-five years in the rooms where the line between innovation and compliance gets drawn.
Global Policy Lead at the Stablecoin Standard, Founder of Warburton Advisers, and Chair of the Compliance Committee at NYDFS-regulated issuer GMO-Z.com Trust Company, she has built the operational scaffolding that lets stablecoin issuers get licensed, raise institutional money, and survive scrutiny, and she's led the response when a major digital-asset cyber breach went multi-jurisdictional.
So when she says the industry's biggest unsolved problem is a definitional one, it's worth slowing down.
"The mistake people make is treating 'stablecoin' as if it names one thing. It doesn't. It names a stack of different products. And the laws are about to make those differences expensive to ignore."
The Word is Doing Too Much Work
The conversation kept circling back to a single, seemingly simple question: should we even be calling all of these things stablecoins?
A token fully backed by central-bank deposits and a token earning yield off a thinly disclosed DeFi reserve are not the same instrument, yet they wear the same name.
Haddock's view is that the terminology itself is creating gaps in adoption, by way of laws and by way of policy, because users, and even some institutions, assume a shared risk profile that isn't there.
It's also the problem the Stablecoin Standard, the global industry body where Haddock serves as Global Policy Lead, built its DeFi Stablecoins Framework and Payment Stablecoin framework to solve. The Standard's payment stablecoin definition is deliberately narrow: a fiat-backed token issued on a blockchain, prudentially regulated with a primary regulator where one exists, with reserves held at a strict 1:1 ratio and composed exclusively of high-quality liquid assets.
The Standard's DeFi stablecoin definition stands outside that realm. That distinction is precisely what regulators on both sides of the Atlantic are now trying to resolve, and they are resolving it very differently.
In the United States, the GENIUS Act was signed into law in July 2025, but, and this is the part most people miss, stablecoins are still regulated under the prior framework of consumer-protection and state laws. As Haddock has noted in her advisory work, today's coins are issued under state money-transmitter and trust licenses without dedicated federal oversight for the products. GENIUS will change the risk profile of a "legal" U.S. stablecoin, but it only takes effect on the earlier of January 18, 2027, or 120 days after federal regulators issue final rules.
The CLARITY Act remains open. Dollar-denominated stablecoins are the priority. And the structure underneath GENIUS is a genuinely complex stack: a dual federal/state model, an inter-agency certification review committee with real discretion, evolving OCC standards, and a $10 billion issuance threshold that triggers transition to OCC supervision.
"There are many more sub-categories, and they get treated differently depending on the product features, distribution and issuance region. That's not a short-term issue. That's the architecture, where the strategy comes into play."
In Europe, by contrast, the instinct is to fit digital money into the existing taxonomy of financial instruments: fewer flavors, cleaner buckets, MiCA doing the heavy lifting. And in the United Kingdom, the Bank of England has taken the most paternalistic posture of the three.
"Layers Like the Earth": A Working Theory of Risk
Haddock's most useful frame is also her bluntest. Every financial instrument carries an inherent amount of risk and opportunity, she argues. The question is never whether but what's the threshold, and is that transparent and understood. Even a bank can go bust. Think of it the way a geologist reads the earth, she says: the value is in understanding the layers stacked beneath the surface before you build on them.
"For stablecoins, it depends on the flavor," she said. "A bank-level coin is meeting bank-level requirements. A DeFi stablecoin is built differently. There are layers of counterparty, smart-contract, and reserve-composition risk stacked underneath the stated peg. If it's a DeFi stablecoin, the important thing is just to be aware before you decide to accept the risks. In exchange for accepting that risk, you get to earn rewards or yield. That could be a fair trade if you can see it clearly."
The danger isn't yield. The danger is mispricing or misunderstanding the operational resilience of a stablecoin product: buying a DeFi product believing you bought a central-bank-grade one. This is where she ties operational resilience into the definitional problem.
When a regime doesn't crisply define what a stablecoin is, it creates market uncertainty. Users should understand, before they participate, how a stablecoin protects against a hack and how its reserves and operational capital are treated.
This is Part 1 of a two-part conversation. In Part 2, Haddock turns to remittances, RWAs, the trust deficit driving adoption, and what she'd tell an institution acting today. → Read Part 2.
