BIS Chief Warns Stablecoins Threaten Monetary Sovereignty

General Manager of the Bank for International Settlements Pablo Hernandez de Cos stated that stablecoins are not a credible means of payment at scale during the Federal Reserve's Jackson Hole Economic Policy Symposium. He argued that tokenized deposits provide a more compelling alternative for daily payments because they preserve the foundations of the monetary system, while stablecoins should be restricted to specialized roles.

De Cos warned that widespread stablecoin use could increase bank funding costs and compromise the singleness of money. He specifically highlighted risks regarding money laundering and the potential for digital dollarization in non-U.S. jurisdictions, which he suggested could threaten monetary sovereignty.

This position contrasts with the view of U.S. Treasury Secretary Scott Bessent. Bessent characterizes stablecoins as a digital revolution that could increase demand for U.S. Treasuries and strengthen the status of the U.S. dollar as the primary global reserve currency.