The Bank for International Settlements (BIS) has challenged the rising enthusiasm surrounding stablecoins, warning that they fall short of the fundamental qualities required for sound money and may only serve a limited role in the future financial system. In a newly released report, the BIS argues that while stablecoins have garnered attention amid growing regulatory clarity and institutional interest, they do not adequately fulfill the criteria of monetary singleness, elasticity, or integrity.
The BIS report criticizes stablecoins for their failure to maintain consistent value (singleness), deliver timely and scalable transactions (elasticity), and sufficiently safeguard against financial crime (integrity). It warns that without strong regulatory frameworks, stablecoins could pose risks to financial stability and national monetary sovereignty.
Rather than relying on stablecoins, the BIS envisions a more secure and efficient future through a unified tokenised ledger that integrates central bank money, commercial bank deposits, and government bonds. This, the report argues, would maintain the foundational principles of sound money while unlocking innovations in cross-border payments and financial markets.
Hyun Song Shin, head of the BIS’s monetary and economic department, said tokenised deposits and central bank money could revolutionize the settlement of securities and correspondent banking by combining programmability with traditional trust anchors.
To support this vision, the BIS is advancing Project Agorá—its collaborative initiative with seven central banks and 43 private institutions—to develop and test tokenised finance infrastructure that aligns with its principles.