Agustin Carstens, general manager of the Bank for International Settlements (BIS), who has previously criticized stablecoins, said events in 2022 cast “serious doubts about the ability of stablecoins to function as money.”
Stablecoins are cryptocurrencies pegged to the value of other assets such as sovereign currencies and do not benefit from the regulatory requirements and protections that apply to bank deposits.
Carstens has previously criticized stablecoins amid widespread concerns that they could shift power in the monetary system from central banks to private entities “driven by profit.”
Instead, he praised tokenized deposits and central bank digital currencies that leverage related technologies and preserve the “trust” provided by public systems.