BIS warns stablecoins are more like ETFs than actual money, and they’re creating FX risk
BIS’s latest annual report dives into stablecoins and AI trends.
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Summary
- The Bank for International Settlements (BIS) argues that stablecoins function more like exchange-traded funds than true money, as their prices often deviate from par and redemptions can be slow or uncertain.
- Stablecoin transfers “settle neither directly nor indirectly on central bank balance sheets,” and “they cannot currently ensure exchange at par across issuers and blockchains under all conditions,” BIS said.
- The report warns that dollar-pegged stablecoins are accelerating dollarization in vulnerable economies, undermining local currencies and evading traditional capital controls.
