The Bank for International Settlements (BIS) released a report on digital currencies on Friday.
According to the report, digital currencies can pose daunting problems in some emerging markets and emerging economies and may not solve the problems addressed by fintech innovations. The report included the following statement:
“Stablecoin regulations aim to improve financial inclusion and cross-border remittances – but this is neither necessary nor sufficient to meet policy objectives. ”
The authors of the report also noted that stablecoins including digital identity, e-money and mobile banking “whether it can offer permanent competitive advantages over rapidly developing digital payment services” also questioned. According to them, stablecoins can pose new risks in issues such as governance, efficiency in payment processes, consumer protection and data privacy.
The authors also expressed concerns about CBDCs:
“In times of systemic stress, there is a risk that households and other agents will shift from bank deposits or other instruments to CBDC, fostering a digital run at unprecedented speed and scale. ”
On the other hand, in the report, stablecoins “closing a great and much needed gap in the face of financial participation and cross-border payments and remittance challenges” underlined.
