BIS says stablecoins fail as money, calls for strict limits on their role

The Bank for International Settlements (BIS) critiques stablecoins, stating they do not fulfill crucial monetary standards, indicating they function more as digital assets than effective currencies.

The BIS report associates stablecoins with risks related to financial crime and underlines the need for strict regulatory measures to mitigate these risks and preserve monetary integrity.

In response to the BIS’s findings, USDC dropped to 0.9997 USD. The report acknowledges stablecoins’ lower transaction costs but insists on a limited regulatory role within the financial system.