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The chair of the Commons’ defence committee, Tobias Ellwood, has resigned from his role following criticism over a video he posted on social media.

The Tory MP, who had been the chair of the cross-party group since 2020, came under pressure to quit after sharing the clip on X, the platform formerly known as Twitter, where he appeared to praise the Taliban’s leadership in Afghanistan.

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Four members of the committee tabled a motion of no confidence against him within days – the first time this measure to remove a committee chair had been used – and a vote was expected to take place by this Thursday.

But a source told Sky News the committee chair “resigned before he was pushed” on Wednesday.

In a statement, Mr Ellwood said he had made the decision with “deep regret” and was “proud of the hard-hitting inquiries” the committee had carried out.

“I believe I have a strong voice when it comes to defence and security,” he added. “I stand up, speak my mind, try to see the bigger picture and offer solutions, especially on the international stage, as our world turns a dangerous corner.

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“I don’t always get it right – so it’s right I put my hand up when I don’t.”

The senior backbencher admitted to “poor communications” on his part over the video, saying it was “understandably criticised at the time and reflected poorly on the committee”.

He added: “Whilst I do believe I retained support of the majority of the committee, its dynamic and effectiveness would simply not be the same, and prove a distraction, if all in the room were not supportive of the chair.”

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Mr Ellwood shared the video in July showing him visiting Afghanistan, just under two years after the country was seized back by the Taliban.

Since its return, the Taliban has reinstated bans on education for girls and introduced laws stopping women from going to work, as well as outlawing women’s beauty salons and preventing women from being in public spaces, such as parks and gyms.

In the clip, the Tory MP – whose brother was killed by Islamist extremists – said the “war-weary nation” was now “accepting a more authoritarian leadership in exchange for stability”.

He urged the UK to reopen its embassy in Afghanistan – saying: “If the EU’s embassy can open up, so can ours.”

And he said: “Shouting from afar will not improve women’s rights.”

After a huge backlash from politicians, human rights campaigners and women’s groups, Mr Ellwood apologised, saying his “reflections” after a “personal visit” to Afghanistan “could have been worded better”.

But he appeared to defend some of his initial thoughts – reiterating that “our current strategy of shouting from afar, after abruptly abandoning the country in 2021, is not working”.

Mr Ellwood argued: “My simple call to action was to see our embassy reopen again and pursue a more direct strategy to help the 40 million people we abandoned.”

It is not yet clear who will replace Mr Ellwood as the committee chair.

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US Federal Reserve Banks say stablecoins could ‘become a source of financial instability’




US Federal Reserve Banks say stablecoins could ‘become a source of financial instability’

The Federal Reserve Banks of Boston and New York published a staff report on Sep. 26 comparing stablecoins, such as USDT and USDC, to money market funds. Key findings in the report include the observation that stablecoins and money market funds follow similar patterns during runs and that stablecoins could inject instability into the broader financial system.

The report, titled “Runs and Flights to Safety: Are Stablecoins the New Money Market Funds?” includes a comprehensive comparison of investor behavior during the stablecoin runs of 2022 and 2023 to investor behavior during the money market fund runs of 2008 and 2020.

Per the publication:

“Our findings show that stablecoins are vulnerable to runs during periods of broad crypto market dislocation as well as idiosyncratic stress events. Should stablecoins continue to grow and become more interconnected with key financial markets, such as short-term funding markets, they could become a source of financial instability for the broader financial system.”

The researchers also note that stablecoins appear to have a discrete “break-the-buck” threshold of $0.99, below which redemptions accelerate and runs — periods in which investors flee, potentially causing an asset crash for remaining investors.

A break-the-buck threshold in money market funds occurs when the net asset value of a fund drops below a dollar, this can lead to investor shares, valued at $1.00, to dip below market price and cause investors to seek safe harbor elsewhere.

Image credit: Anadu, et. al., 2023

As Cointelegraph recently reported, Italy’s central bank is also taking measures to identify contributing factors and prevent stablecoin runs. In a recent statement, the Italian banking authority cited the 2022 Terra Luna collapse as an example that stablecoins “have not proved stable at all.”

According to the report, Italy has also called upon global lawmakers to form an international regulatory body to govern cryptocurrency, stablecoins, and related technologies.

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