You are viewing CRYPTOPRU 4.4 K-factor requirement for stablecoins in issuance (K-SII) as it appeared on 25/10/2027. The current version of CRYPTOPRU 4.4 K-factor requirement for stablecoins in issuance (K-SII) was last updated on 25/10/2027.

CRYPTOPRU 4.4 K-factor requirement for stablecoins in issuance (K-SII)

25/10/2027R

The K-SII requirement of a firm that is issuing a qualifying stablecoin is equal to 1% of its average SII.

25/10/2027R

A firm must calculate its K-SII requirement:

  1. (1) on the first business day on which CRYPTOPRU applies to the firm; and
  2. (2) thereafter, on the first business day of each month.

Calculating SII

25/10/2027R

A firm must calculate its average SII by:

  1. (1) taking the total SII as measured at the end of each business day for the previous 9 months;
  2. (2) excluding the values for the most recent 3 months; and
  3. (3) calculating the arithmetic mean of the daily values for the remaining 6 months.
25/10/2027G
  1. (1) As the definition of SII includes any qualifying stablecoins that the qualifying stablecoin issuer is liable to redeem, this:
    1. (a) includes qualifying stablecoins that were minted at any time, including before CRYPTOPRU came into force; and
    2. (b) includes qualifying stablecoins that have been minted by a person other than the qualifying stablecoin issuer (which could include qualifying stablecoins minted outside the UK) if they are fungible with the relevant qualifying stablecoins; but
    3. (c) excludes qualifying stablecoins that have been burned.
  2. (2) The definition of SII excludes qualifying stablecoins the value of which has been deducted from the qualifying stablecoin issuer’s own funds, in accordance with COREPRU 3.3.39R. Such qualifying stablecoins will not therefore be included in the calculation of average SII.

Firms with less than 9 months of data on SII

25/10/2027R

Where a firm has been issuing a qualifying stablecoin for less than 9 months, it must calculate its average SII as follows:

  1. (1) during the first month in which it is issuing a qualifying stablecoin, the firm must:
    1. (a) make a best-efforts estimate of expected SII for that month; and
    2. (b) use that estimate as its average SII; and
  2. (2) during the subsequent 8 months, the firm’s average SII must be calculated in accordance with CRYPTOPRU 4.11.1R(2).
Point In Time
25/10/2027