Stablecoins are not a credible way to make payments at scale, Pablo Hernández de Cos, general manager of the Bank for International Settlements (BIS), said on August 28, 2026, at the Jackson Hole Economic Symposium hosted by the Federal Reserve Bank of Kansas City. He argued that tokenized deposits, ordinary bank liabilities recorded on a distributed ledger, are the better route for tokenized payments.
Tokenized deposits keep the singleness of money intact
His core argument rests on the singleness of money: the principle that a euro held at a bank is always worth a euro, whatever form it takes. A tokenized deposit is still a liability of a supervised bank and ultimately settles in central bank money, so that property holds. A stablecoin has no mechanism that guarantees it always trades at par, and wallet-to-wallet transfers largely escape conventional bank oversight.
His second point was compliance. Most stablecoin balances sit in self-custodied wallets, which makes anti-money laundering and counter-terrorist financing (AML/CFT) rules harder to enforce. Tokenized deposits move on permissioned platforms and stay tied to an identified account, which makes that monitoring easier.
Activity restrictions stop at the issuing entity
The same week, the BIS’s Financial Stability Institute (FSI) published a separate brief comparing stablecoin issuance regimes in five jurisdictions: the EU, Hong Kong, Singapore, the UK, and the US. Its central finding is not about how stablecoins are defined but about the scope of the rules that govern them. Activity restrictions apply to the issuing entity, never to the group it belongs to.
- Lending out the funds received in exchange for the tokens issued
- Staking, or committing those assets to a yield-generating mechanism
- Custody of third-party digital assets on behalf of outside clients
The issuer itself is typically barred from all three. Nothing stops a sister company in the same group from doing them. A non-bank issuer can comply with the letter of the rules while housing, one affiliate away, exactly what those rules were meant to prevent.
| Jurisdiction | Approach for non-bank issuers |
|---|---|
| US (GENIUS Act) | Restrictive: the issuer may not lend, stake, trade on its own account, or hold third-party crypto assets in custody |
| Singapore | Restrictive, on a model close to the US regime |
| Hong Kong | Additional activities allowed with a separate authorization |
| UK | Additional activities allowed with a separate authorization |
| EU (MiCA) | Additional activities allowed with a separate authorization |
US issuers already spread functions across entities
The risk is not theoretical. In the US, trust charter approvals by the Office of the Comptroller of the Currency (OCC) show that stablecoin issuers already commonly split their business across several entities, each housing a different function of the same enterprise. The FSI’s answer is consolidated, group-level supervision, especially for the largest non-bank issuers, where the cost of that risk materializing would be highest.
For a payment provider considering stablecoin settlement, the two publications point the same way: a token’s soundness depends not only on its issuance terms but on the structure of the group behind it. An issuer affiliated with an entity that lends, holds in custody, or earns a return on the same assets elsewhere in the group deserves deeper due diligence than a check that the issuer alone meets its restrictions.