BoE Governor Warns Stablecoin Boom Could Undermine Monetary Trust – Central Banks on Alert

Key Points

1. Andrew Bailey cautioned that emerging digital forms of money, like stablecoins, could challenge the concept of a 'reserve currency' and the 'singleness of money.'

2. He noted that stablecoins, if widely adopted, could disrupt trust in traditional monetary systems and central bank liquidity.

3. Bailey highlighted historical parallels, such as the instability caused by U.S. banks issuing their own notes in the 19th century, to underscore potential risks.

4. He emphasized that stablecoins would need to meet high standards to be considered as part of official reserves.

5. The remarks were made during his speech at the Andrew Crockett Memorial Lecture on July 3.