Cross-border payment costs expected to decline, IMF chief says stablecoins could undermine emerging market currency sovereignty

Odaily News, Christine Lagarde... International Monetary Fund (IMF) Managing Director Georgieva stated at the Jackson Hole annual meeting that stablecoins and tokenization could enhance global financial liquidity, making large-scale cross-border payments cheaper and faster; however, stablecoins could also exacerbate currency substitution, capital flows, and exchange rate volatility, while undermining capital controls and monetary sovereignty. Dollar-pegged stablecoins could expand the global network effects of the US dollar, marginally reducing US financing costs, but they cannot replace fiscal discipline. Relevant discussions indicate that the BIS tends to favor the marginalization of stablecoins with tokenized deposits taking center stage; the ECB leans toward placing central bank money on-chain; the IMF acknowledges the efficiency of stablecoins in cross-border payments while focusing risk concerns on currency substitution and capital flows in emerging markets.