The worldwide financial system needs to rewrite its rules for a future of tokens, as the rise of stablecoins poses new challenges to the global infrastructure for instant payment, clearing and settlement, according to the gatekeeper of the world’s central banks.
Stablecoins, which are digital tokens backed by fiat currencies or other reserve assets, could make anti-money-laundering (AML) work and banks’ task of knowing their customers more difficult because of their cross-border, pseudonymous transactions, said the Bank for International Settlements (BIS), the organisation that is often dubbed the “central bank of central banks.”
“The rules of the monetary system are changing and stablecoins are right at the front line of the policy debate,” said Shin Hyun-Song, BIS’ economic adviser and the head of its monetary and economic department, during an interview with the Post on Monday in Hong Kong. “[Stablecoin] is a borderless instrument used mainly as the gateway to the crypto ecosystem and other decentralised finance platforms, but it also generates many new types of challenges.”
The challenges have been exacerbated by the buzz around the stablecoin issuer Circle Internet Group, whose stock price has soared sevenfold within a month of its June 5 initial public offering in New York. The Trump administration’s embrace of private digital currencies has sent bitcoin’s value past US$120,000 for the first time, luring more believers to join the fray.
Shin Hyun-Song, the economic adviser and head of the monetary and economic department of the Bank for International Settlements (BIS), during an interview at Two IFC in Central on July 14, 2025. Photo: Jonathan Wong.
