A top ECB official highlights risks and parallels between stablecoins and historical monetary innovations like the Bank of Amsterdam’s bank money.
European Central Bank Executive Board member Isabel Schnabel said stablecoins, privately issued digital tokens pegged to fiat currencies, could alter financial system structures. Their rapid growth raises concerns about financial stability, monetary policy, and the international monetary order, she noted in a speech in Seoul.
Schnabel drew comparisons to the Bank of Amsterdam’s “bank money,” an early stablecoin-like instrument backed by high-quality assets. It became a trusted settlement tool and dominant international currency for over a century before declining. The ECB has previously flagged stablecoins as potential disruptors to traditional banking and payment systems.
The speech did not outline immediate policy shifts but underscored the need for central banks to monitor private digital currencies closely. Stablecoins’ asset-backed nature and scalability could influence liquidity dynamics and monetary transmission mechanisms.