There have been
several reports on cryptocurrencies by the Bank of International Settlements (BIS). All of them said that they were not yet sufficient in scale to represent serious risks.
Today’s
G7 Working Group Report on Stablecoins, produced by the BIS, represents a change of tune. Global stablecoins such as Libra represent a systemic risk. The BIS defines a global stablecoin (GSC) as an initiative built on an existing large customer base with the potential to scale rapidly.
Among a broad range of risks, four are highlighted. The first is the impact on how countries can influence their own monetary policy. A related point is that in some countries, the stablecoin could be attractive to citizens, resulting in monetary substitution and financial instability. The G7 report references one of
Benoit Coeuré’s (chair of the working group) speeches, which made the same conclusion in July.
Article continues …
Want the full story? Pro subscribers get complete articles, exclusive industry analysis, and early access to legislative updates that keep you ahead of the competition. Join the professionals who are choosing deeper insights over surface level news.
