Switzerland's financial markets regulator, FINMA, has proposed new regulations to reduce risks for banks that provide a default guarantee to stablecoin holders. The regulator warns that banks may suffer reputational damage if there are irregularities at the stablecoin issuer. Stablecoin issuers in Switzerland pose a risk to the banks they work with, as they can avoid the need for a banking license by partnering with a registered lender to repay customers in case of default. FINMA has published guidance on this issue.