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BIS says stablecoins still fall short as payment tool, tokenised deposits back in focus

The head of the Bank for International Settlements said stablecoins lack reliability as a large-scale payment method and argued tokenised deposits are a stronger option that can use tokenisation while preserving the foundations of the monetary system. He said stablecoins may struggle to serve as everyday money and warned that shifts from bank deposits could raise banks’ funding costs and lift borrowing rates. He also cited interoperability and anti-money-laundering challenges and potential risks to monetary sovereignty.