Carstens backs regulated stablecoin coexistence as BIS warns

Former BIS general manager Agustín Carstens publicly softened his stance on stablecoins, arguing they can coexist with fiat money if policymakers set the right regulatory conditions. The Bank for International Settlements, in a preview ahead of its Annual Economic Report 2026, reiterated that today’s stablecoin designs still fail key “trusted money” properties and could pose macro risks if adoption scales.

Key Takeaways

Agustín Carstens said he has “come to appreciate” stablecoins for driving innovation, inclusion, and lower costs in a livestreamed welcome address at the Point Zero Forum.
Policymakers were urged to set conditions for stablecoins to coexist with fiat money, with Carstens warning global regulatory coordination is falling behind.
A BIS preview ahead of its Annual Economic Report 2026 said current stablecoin designs still fall short of the properties that underpin trust in money and could threaten stability if widely adopted.
The US GENIUS Act and the EU’s MiCA framework already impose reserve and authorization requirements, including 100% backing in the US and reserve segregation rules in the EU.

Carstens’ Stablecoin Pivot at Point Zero Forum

Agustín Carstens, the former general manager of the Bank for International Settlements (BIS) and now a member of the Global Finance & Technology Network’s international advisory board, used a livestreamed welcome address at the Point Zero Forum on Tuesday to reframe stablecoins as a conditional positive.

“I have come to appreciate what stablecoins can do to promote financial innovation, inclusion and to reduce costs,” Carstens said. He added: “We should try to establish conditions where we can live with fiat money and stablecoins.”

That language matters because it shifts the posture from “stablecoins as a threat” to “stablecoins as permitted infrastructure,” with legitimacy explicitly tied to regulatory design. Carstens also argued that more regulation and a level playing field for issuers could help stablecoins “flourish in a dramatic way,” positioning compliance as an adoption catalyst rather than a brake.

Global Rules, Local Frameworks: GENIUS Act and MiCA as Reference Points

Carstens’ core constraint was coordination. “If we really want a global system where stablecoins can interact with global currency, this has to be a cooperative effort worldwide. And I see this lagging behind,” he said.

In practice, the market is already moving under fragmented rulebooks. In the US, the GENIUS Act, signed into law in July 2025, created a federal framework for payment stablecoins and requires 100% reserves in high-quality liquid assets such as cash and short-term US Treasurys.

In the EU, stablecoin issuers fall under the Markets in Crypto-Assets Regulation (MiCA). MiCA requires issuer authorization, publication of an approved white paper, full reserve backing, and segregation of reserve assets from company funds.

For traders, “coexistence” under these regimes is less about ideology and more about plumbing: what counts as eligible reserves, how segregated assets are treated in stress, and whether cross-border issuance can scale without regulatory arbitrage.

BIS Annual Report 2026 Preview: Stablecoins Still Fail the ‘Trusted Money’ Test

The BIS message running in parallel is tighter and more skeptical. In a preview released Tuesday ahead of its Annual Economic Report 2026, the BIS argued that current stablecoin designs fall short of key properties that underpin trust in money.

The preview also warned that if stablecoin adoption becomes widespread, it could create challenges for financial stability, bank funding, and monetary sovereignty. That is the macro frame: stablecoins are still treated as a structure that can transmit stress into the banking system and complicate policy control if they become a meaningful substitute for bank deposits or sovereign currency.

Current BIS leadership has kept that line. BIS general manager Pablo Hernández de Cos said in April that the stablecoin market remains “small” and that structural features constrain stablecoins’ ability to function as money.

The nuance is that the BIS simultaneously endorsed bringing tokenization into the two-tier banking system, arguing digital representations of assets could enable programmable finance while preserving trust in money. Stablecoins, in this framing, remain the weak link even as tokenization gets a green light.

Signals Traders Can Track From Here

The next hard catalyst is the publication of the BIS Annual Economic Report 2026, which should clarify whether the preview’s critique is aimed at specific stablecoin structures, reserve models, or governance designs, and how strongly the BIS separates “tokenization inside the two-tier system” from private money.

Traders also have a near-term signal in follow-on remarks from Carstens and other Point Zero Forum participants that define what “conditions” for fiat–stablecoin coexistence actually mean, including issuer eligibility, redemption guarantees, and cross-border interoperability.

On the enforcement side, implementation details under the US GENIUS Act will matter, particularly reserve composition, supervisory approach, and how regulators treat operational and liquidity risk. Comparable updates under EU MiCA will be watched for how strictly authorization and reserve segregation are applied in practice.

Finally, any evidence of cross-border coordination, such as joint standards or interoperability guidance, would directly test Carstens’ claim that global cooperation is lagging.

The Market Signal in a Split BIS Message

I read Carstens’ pivot as a narrative shift with real second-order implications: it moves the debate from “ban or tolerate” to “design the rulebook,” which is where adoption actually gets decided. The market tends to price stablecoin growth when it sees regulatory pathways that reduce tail risk around redemptions and reserve quality, not when it hears generic pro-innovation rhetoric.

The BIS preview is the counterweight. It is effectively saying that even under heavier policy attention, today’s stablecoin structures still do not clear the bar for trusted money, and the risk only becomes visible when scale arrives. The threshold that matters is whether major jurisdictions converge on interoperable standards that make stablecoins boring enough to be systemic without becoming a systemic problem.

Carstens backs regulated stablecoin coexistence as BIS warns designs still fall short