Stablecoin adoption could heighten risks to financial stability, and central banks must respond with robust regulation and central bank digital currencies (CBDCs), such as the digital euro, to preserve the anchoring role of central bank money, according to Isabel Schnabel, a European Central Bank board member.
During a Monday speech at the 2026 Bank of Korea International Conference in Seoul, Schnabel said that the global stablecoin market cap has expanded swiftly and that stablecoins pose risks to financial stability, monetary policy, and the international monetary order.
"Due to their liquidity mismatch and a potential loss of trust in the quality of the assets, they are also subject to the risk of runs," said Schnabel.
The ECB official warned that dollar-denominated stablecoins risk cementing USD dominance through network effects, potentially amplifying the "international transmission of U.S. monetary policy," while euro-pegged stablecoins remain marginal.
"The growing use of stablecoins may further cement the international dominance of the U.S. dollar," said Schnabel. "Today, virtually all stablecoins in circulation are denominated in dollars, with other currencies playing a negligible role."
