Swiss Central Bank Warns Stablecoins Could Disrupt Monetary Policy

Swiss National Bank board member Petra Tschudin expressed concerns over the impact of large stablecoins on monetary policy transmission. In a statement, she warned that widespread use of stablecoins could undermine central bank money's role as risk-free cash for interbank settlements.

Tschudin highlighted that funds shifting from commercial banks into stablecoins could reduce lending capacity and weaken the central bank's influence over interest rates. She emphasized that innovation should be examined for its consequences and how it should be regulated.

The SNB welcomes innovation, but Tschudin is cautious about the effect of stablecoin technology on central bank money. She noted that a 'stablecoin franc' is not automatically guaranteed to be worth the same as a real franc because stablecoins operate outside the central bank system.