Stablecoins Enter New Era of Compliance and Monitoring, Says Eunice Founder Yi Luo

By Vishwesh Iyer

As the global digital asset ecosystem matures, stablecoins have emerged as one of its most promising and widely adopted use cases. But with rapid growth comes new challenges around regulation, compliance, and risk management – areas that Yi Luo, founder of the AI-driven fintech platform Eunice, believes are still significantly underserved.

Speaking to AsiaBizToday.com, Luo explained how stablecoins, digital assets typically pegged to fiat currencies like the US dollar or Hong Kong dollar, have increasingly taken centre stage in the digital finance world. Unlike earlier crypto trends such as NFTs or decentralised finance (DeFi), Luo believes stablecoins present a far more practical and mainstream opportunity for financial innovation.

“Stablecoins are essentially a digital promise,” Luo said. “If you give me one dollar, I give you one dollar back – instantly, globally, and on-chain. That level of efficiency and cross-border functionality simply doesn’t exist in traditional finance, which still involves multiple intermediaries and regulatory friction.”

The compliance gap in stablecoins

However, as adoption accelerates, Luo sees a growing gap in how these assets are evaluated for safety and compliance, especially as new stablecoin issuers emerge almost weekly.

“We often hear about the use cases and potential of stablecoins. What’s missing is sufficient focus on their compliance and risk framework,” she noted. “Are all stablecoins equally safe for consumers, counterparties, and financial institutions? Who’s monitoring the ecosystem to ensure transparency, proper reserve management, or even detect illicit activities?”

This gap is precisely what Eunice’s recently launched stablecoin due diligence and monitoring solution aims to address. Built on Basel standards for risk assessment, Eunice offers a framework for third-party evaluation of stablecoin issuers. The platform provides independent verification of backing assets, redemption processes, reserve quality, financial crime monitoring, and overall ecosystem risk.

The need for such independent oversight is increasingly evident as financial institutions, brokers, and exchanges expand their stablecoin offerings. Luo cited an example where a broker supporting five stablecoins was looking to scale up to 15 but lacked a reliable, independent tool to assess and monitor the new issuers’ risk profiles.

“We fill that gap by providing data-driven insights that allow institutions to move forward confidently while meeting regulatory expectations,” she said.

Global growth but regional nuances

While stablecoins are inherently global in nature, regional regulatory regimes are evolving at different paces. Luo pointed to recent regulatory developments in Hong Kong, the United States, and Singapore as strong signals that regulators are beginning to address stablecoins in earnest.

“Wherever there’s regulatory clarity, you tend to see institutional adoption follow quite quickly,” she said, citing Hong Kong’s new stablecoin legislation and Singapore’s progressive work under the Monetary Authority of Singapore (MAS).

Emerging markets such as Latin America are also proving fertile ground for stablecoin adoption, with mobile-native populations leapfrogging traditional banking infrastructure. However, Luo sees a more nuanced opportunity for region-specific stablecoins, such as those backed by the Hong Kong dollar, particularly as China-led economic partnerships under the Belt and Road Initiative create demand for alternative settlement options outside the US dollar.

“Certain Silk Road economies may prefer Hong Kong dollar-backed stablecoins to reduce reliance on the US dollar. That creates a unique, politically influenced use case specific to this region,” Luo explained.

Bridging global standards with technology

Interestingly, Eunice’s platform is designed to balance global consistency with regional flexibility. While its stablecoin monitoring applies a common framework focused on sector-specific metrics such as reserves, redemption, and ecosystem risks, the platform also allows clients to incorporate jurisdictional legal analysis for other token classifications—such as securities or utility tokens.

This flexible approach has already attracted interest from regulators in Europe and beyond, who are using Eunice’s assessments to cross-check compliance documents, such as MiCA whitepapers.

“Our platform can serve as a third-party opinion tool for regulators and institutions. While they perform their own due diligence, we provide additional monitoring pipelines and highlight emerging risk signals,” Luo said.

Navigating the complexity of launching a stablecoin

Launching a stablecoin today is far more complex than the early days of crypto innovation, Luo emphasised. Issuers must navigate a web of legal, regulatory, operational, and technological requirements depending on where they operate.

“It’s not something you can launch in a few months anymore. Whether it’s obtaining e-money licences in the UK or digital payment token licences in Singapore and Hong Kong, the regulatory bar is now much higher,” Luo said.

Issuers must also build sophisticated reserve management systems, partner with multiple banks to diversify risk, implement audit regimes, develop token minting and burning mechanisms, and create adoption strategies that drive actual usage.

“Even a fully licensed stablecoin is worthless if no one uses it,” Luo added. “Adoption and distribution remain a major challenge for any new issuer.”

Towards standardisation — and eventually ratings

Looking ahead, Luo believes that stablecoins are uniquely positioned within the broader digital asset landscape to achieve standardisation, much like credit ratings or mutual fund classifications in traditional finance.

“If there’s one asset class in crypto that can have ratings, it’s stablecoins,” she said. “We’ve already developed a stablecoin rating model internally based on Basel standards, which we’re beta testing with clients.”

While Luo is cautious about proclaiming Eunice as the standard-setter, she sees the platform contributing meaningfully to industry-wide efforts to establish best practices and benchmarks.

“The entire industry needs to come together, just like how S&P, Moody’s, or Morningstar emerged over time for other asset classes. We want to contribute to that evolution for stablecoins.”

What’s next for Eunice?

For Eunice, the roadmap is packed with priorities. Luo’s team is working to expand coverage to include more stablecoins—each requiring significant custom data pipelines to monitor unique redemption terms, on-chain activity, and risk factors. The firm is also exploring B2B2B use cases where its data can help institutions onboard their own clients more efficiently.

“There’s so much data work to be done. Our mission is to keep improving data quality, expand stablecoin coverage, and make our monitoring indispensable to every layer of the ecosystem,” she said.

The personal mission behind Eunice

Luo’s passion for building Eunice is deeply personal. A former venture capitalist with years spent analysing digital asset investments, she saw early on how compliance gaps were holding back institutional adoption of crypto assets. Her prior fintech experience in the US also shaped her view that legal and compliance frameworks are essential enablers of market growth.

But there’s another layer to Eunice’s story—the origin of its name. Luo named the company after Eunice Foote, a 19th-century female scientist who first discovered the warming effects of carbon dioxide but was barred from presenting her work because of her gender.

“I’m also a mother of two, like Eunice Foote was. She wanted to make the world a better place. That resonates deeply with me as I build Eunice to address critical gaps in this evolving industry,” Luo reflected.

As stablecoins inch closer to mainstream finance, Eunice’s work may well shape how the asset class earns trust, achieves transparency, and safely scales into global financial systems.

Also read Yi Luo’s personal journey here.