LIBOR→SOFR Transition (2023)
mechanismMoney & Finance
In 2023 the number that priced the world's loans was quietly swapped for one wired straight into US government debt.
Who they are
The LIBOR-to-SOFR transition, run by the Fed and the New York Fed's committee.
What they do
The old benchmark — banks' estimated borrowing costs — was retired on June 30, 2023, replaced by SOFR, computed from over $1 trillion a day of real lending backed entirely by US Treasuries.
How it works
Every contract that referenced the old number migrated to the new one. No vote, no headline — a plumbing swap under trillions in loans.
Why it matters
Because now the world's lending rates are mathematically tied to US government debt. The engine reads it as the perimeter-move template: rebuild the rail beneath everyone, announce nothing.
The engine's record — word for word
The benchmark-rate switch that quietly rebuilt the monetary perimeter: USD LIBOR (unsecured, panel-bank ESTIMATES) ceased June 30, 2023, replaced by SOFR — a rate computed from actual overnight repo transactions collateralized entirely by US Treasuries, >$1T daily underlying volume (NY Fed/ARRC). Effect: the world's lending benchmarks are now mathematically bound to the US sovereign-debt substrate. The perimeter-move template — rebuild the rail beneath everyone, announce nothing. [Report #178] Central-bank tier.
Follow the trail
pairs
FIMA Repo Facility (2020)The perimeter's two quiet moves: bind the world's benchmark to UST collateral (SOFR), then backstop foreign UST holders so they never have to sell (FIMA) [Repor
templates
GENIUS Act / CLARITY ActSame perimeter move twice: SOFR binds benchmarks to USTs; GENIUS binds stablecoin reserves to USTs — private rails, sovereign-debt substrate [Report #178]
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