In a working paper published on Tuesday 3 March, experts from the European Central Bank (ECB) warned of the risks of banking disintermediation and disruption to monetary policy if the use of stablecoins, private cryptocurrencies with a stable value, were to increase in the euro area.
They point out that increasing use of these digital assets could encourage households and businesses to shift some of their funds from traditional bank deposits to stablecoins, at the risk of reducing banks’...