Central banks warn US-stablecoins could deepen dollarisation in emerging markets

Senior central bankers warn that the rapid rise of USD-denominated stablecoins used in international payments could accelerate dollarisation in emerging markets, threaten monetary sovereignty, and facilitate illicit activity and capital-control evasion; while some officials see faster, cheaper cross-border payments as a benefit, regulators are racing to craft rules and a BIS-led effort to tokenize deposits aims to counter the threat; EM holdings of dollar stablecoins could reach about $1.22tn by 2028, up from roughly $173bn today.