BIS warns stablecoins miss money criteria, flags emerging‑market risk

Stablecoins fall short of money standards, BIS says

The Bank for International Settlements (BIS) laid out in its annual review that stablecoins lack the singularity, elasticity and integrity that define true money. Singularity—the ability to serve as a unique unit of account—is compromised by multiple token designs. Elasticity—the capacity to expand or contract with economic activity—is absent because most stablecoins are pegged to a single fiat reserve without dynamic supply mechanisms. Integrity suffers as regulatory oversight varies across jurisdictions, exposing users to counter‑party risk.

“The proliferation of stablecoins in emerging markets creates a parallel monetary system that could destabilise local currencies,” the BIS report warned.

The document flags a ↓ 12% projected share of stablecoins in emerging‑market payments by 2028, citing volatile capital flows and limited legal frameworks. Analysts at Reuters note that central banks are already drafting digital‑currency blueprints to pre‑empt such gaps. Meanwhile, Bloomberg highlights that only three stablecoins meet rigorous reserve‑audit standards, a fraction of the over 150 tokens currently in circulation. The BIS conclusion: without unified oversight, stablecoins remain a peripheral asset class, not a substitute for sovereign money.