BIS Chief Urges Global Stablecoin Rules to Curb Digital Dollarization

Bank for International Settlements (BIS) General Manager Pablo Hernández de Cos called for urgent international cooperation on stablecoin regulation during a Bank of Japan seminar on April 20, 2026. He characterized stablecoins as a double-edged sword, noting that while they improve cross-border payments, they pose significant macroeconomic risks and facilitate regulatory circumvention, tax evasion, and sanctions evasion.

De Cos warned that divergent regulatory frameworks could lead to severe market fragmentation and enable regulatory arbitrage. He specifically noted that issuers like Tether and Circle operate more like exchange-traded funds than money due to redemption frictions. To mitigate these risks, he proposed limiting interest payments and granting issuers access to central bank lending facilities or deposit-insurance arrangements.

These warnings coincide with concerns from the Bank of England and International Monetary Fund regarding digital dollarization, where U.S. dollar-denominated stablecoins weaken domestic currencies and bypass capital controls in emerging markets. Bank of England Governor Andrew Bailey stated that progress on establishing international rules has slowed over the past year. In response to this dollar dependency, French Finance Minister Roland Lescure urged European banks to develop more euro-based stablecoins and tokenized deposits to ensure regional autonomy.

These developments follow a regulatory shift in the United States, where President Donald Trump signed the GENIUS Act in July 2025 to create the first federal regulatory framework for payment stablecoins. The U.S. is further advancing the Digital Asset Market Clarity Act to establish additional federal rules for digital asset markets.