BIS Questions Stablecoins' Monetary Status, Warns of Dollar-Ization Risk in Emerging Markets

According to the BIS in its 2026 annual economic report, stablecoins lack true monetary properties in terms of ubiquity, resilience, interoperability, and completeness, functioning more like ETF shares than genuine payment instruments. Global stablecoins total approximately $320 billion in value, with over 99% pegged to the US dollar and dominated by USDT and USDC.

The BIS warned that emerging markets face "stablecoin dollar-ization" risk, where residents adopt dollar-denominated stablecoins as stores of value, potentially altering capital flows and eroding monetary sovereignty. The bank recommended integrating tokenized central bank reserves, commercial bank money, and regulated private currencies through a "unified ledger" framework, anchored by central bank digital currency.