US, UK central bankers offer contrary views on stablecoins

US Federal Reserve governor Christopher Waller said Sunday that the growing use of dollar-backed stablecoins could bolster the global influence of US monetary policy.

Waller told participants at the 32nd Dubrovnik Economics Conference that countries that increasingly rely on stablecoins backed by the US dollar may effectively import US monetary conditions, Bloomberg News reported Sunday.

“I've always just looked at ​stablecoins as a payment instrument; there's nothing evil about it, nothing dangerous about it,” Waller said. “They ​are just bringing competition into the payments world,” Reuters reported.

Source: The 32nd Dubrovnik Economic Conference

A contrary view was presented by his fellow presenter, Bank of England policymaker Megan Greene, who said stablecoins could fade from view in a matter of a few years. She said:

“I think tokenized deposits are probably going to take over from stablecoins and ​five years from now, I suspect we might wonder why we were talking about stablecoins.”

Both were part of a panel discussion titled “Stablecoins and monetary policy” at the annual Croatian National Bank event.

A long-time skeptic of central bank digital currencies (CBDC), Waller said that enthusiasm for CBDCs has faded among many central banks. BoE's Greene disagreed.

“I like to think of it as a massive race between the tortoise, the hare and the rhino.” Greene said. “The tortoise is the central ⁠bank ​digital currency ...the hare is stablecoins and the rhino is tokenized ​deposits. We'll probably end up with all three, but if I had to put money in one ... it would be the ​rhino, tokenised deposits, which I think will probably take off,” Reuters reported.

Related: ECB pushes back on euro stablecoin proposals, citing financial stability risks

Stablecoin policy stymies US crypto legislation

Debate over US policy on stablecoin yield has stymied progress on the US Digital Asset Market Clarity Act under consideration in the US Senate. 

The crypto market structure bill is one of the most significant pieces of crypto regulations in the US, but it is unclear if it will be signed into law in 2026 due to opposition from the banking lobby and the looming US midterm elections.

The CLARITY Act, which aims to establish a federal regulatory framework for digital assets passed out of the Senate Banking Committee on May 15 after months of debate between banks and the crypto industry over stablecoin yield provisions. However, it must still pass both chambers of Congress before heading to the president's desk.

Wyoming Senator Cynthia Lummis warned Saturday that the US will lose its leadership position in crypto to other countries, including China, if lawmakers fail to pass the legislation this year.

Source: Senator Cynthia Lummis

“America built the dollar-dominated financial system that has anchored global stability for a century. The Clarity Act ensures we build the next one. The time to act is now, before Beijing decides it will,” Lummis said in an X post.

Learn: Why banks are fighting stablecoins after shaping the rules