BIS Chief Says Stablecoins Lack Credibility for Everyday Payments at Scale
BIS chief questions stablecoin role in daily payments
The Bank for International Settlements (BIS) is raising fresh doubts about whether stablecoins can work as real money for everyday use. A stablecoin is a digital token tied to the value of a currency like the US dollar, meant to stay steady in price.
Pablo Hernández de Cos, the BIS general manager, said on Friday that stablecoins do not clearly function as a means of payment when used on a large scale. He suggested that tokenized bank deposits offer a stronger and safer path forward. Tokenized deposits are digital versions of money held directly in banks, issued on blockchain networks.
His comments come as governments around the world work out new rules for how stablecoins should be controlled.
How rules differ across major economies
A study from the BIS-linked Financial Stability Institute (FSI), published on Thursday, compared stablecoin regulations in the US, European Union, United Kingdom, Hong Kong, and Singapore. It found large gaps in who is allowed to issue these tokens and what other business activities they can run.
The US and Singapore take a stricter approach toward non-bank issuers. Under the US GENIUS Act, payment stablecoin issuers are generally barred from lending, staking, proprietary trading, or holding custody of third-party crypto assets.
Hong Kong, the UK, and the EU are more open. They allow some extra activities if the issuer gets separate approval or meets certain permissions.
The study also found that these restrictions apply only to the specific entity issuing the stablecoin, not to the larger corporate group it belongs to. That means other companies within the same group can still carry out activities that the stablecoin issuer itself cannot.
Wider economic risks highlighted
Hernández de Cos acknowledged that stablecoins could help lower government borrowing costs. He noted that US Treasury Secretary Scott Bessent has made a similar argument.
However, he warned the trend could hurt ordinary consumers too. If people move their money from banks into stablecoins, banks may face higher funding costs. Those costs could then be passed on to households and businesses in the form of higher loan rates.
He also pointed to practical problems such as limited ability for different stablecoin platforms to work together and difficulties in consistently applying anti-money laundering controls. Growing use of US dollar-pegged stablecoins outside the US could also weaken domestic monetary policy and reduce a government’s control over its own money, he said.
Why this matters for the crypto payments debate
The BIS push comes at a time when several major economies are moving to regulate stablecoins rather than ban them. The central bank’s leader has long favored innovation that keeps traditional banking systems intact, and his remarks reinforce the view that tokenized deposits may be seen as a more credible option than privately issued stablecoins for mass payments.
