The head of the BIS, the central bank for central banks, Pablo Hernández de Cos said Friday that stablecoins, in their current form, aren't a credible means of payment at scale, and that tokenized bank deposits are the better path. A perfectly reasonable thing to say when your shareholders are central banks and the alternative keeps deposits inside the banking system.

LATEST: 🏦 A BIS-led project with 40+ financial institutions found tokenized central bank reserves and deposits could significantly cut settlement times and costs in cross-border payments.

The central banks' central bank says stablecoins still aren't real money The BIS (@BIS_org) has used its flagship annual report to deliver a blunt verdict: stablecoins in their current form fail the basic tests of money. They break from their peg, carry redemption frictions, and behave more like ETF shares than a means of payment, the report argues. It goes further on risk. The BIS says stablecoins account for a significant share of illicit on-chain activity and warns of "stablecoin dollarisation," where dollar-pegged coins flood emerging economies and erode local monetary control. Today 99.4% of fiat-backed stablecoins track the dollar. The BIS wants central banks to build their own tokenized rails instead, its long-running answer to private stablecoins.

LATEST: 🇺🇸 Former CFTC Chair Timothy Massad says the US is quietly exploring CBDC infrastructure through the BIS's Project Agora despite a public pledge to ban a digital dollar.

LATEST: The Bank for International Settlements publishes a paper using the XRP Ledger as a proof-of-concept for verifying official statistics on-chain. The BIS cites XRPL's low fees, 3-5 second settlement and proven track record, though no adoption decision has been made.

OPINION: The CLARITY act will bring more strength to the dollar, not less. It's time regulators moved forward. About 98% of stablecoin value is dollar-denominated, and the BIS argues that lets dollar substitution take hold in unstable economies faster than those governments can respond to it. @SecScottBessent describes the same mechanism as the goal, saying stablecoins expand dollar access for billions and drive demand for Treasuries. He's spent the past two weeks pushing the Senate to pass CLARITY before recess.