A new IMF report warns that fast-rising stablecoin adoption, especially in emerging markets, could undermine financial stability and monetary control.
A new IMF report says stablecoin use is rising sharply worldwide, warning that weak regulation and fragmented oversight could fuel financial risks. According to the Understanding Stablecoins 2025 paper, stablecoin holdings relative to total deposits in Africa climbed from “virtually zero in 2020 to 1.5% by 2024.” The IMF notes that demand may keep rising in countries with inflation, weak local currencies, and limited access to foreign exchange.
The report highlights wide gaps in global rules, with the US, UK, EU, and Japan adopting differing standards. This fragmentation, the IMF says, creates interoperability problems and opens the door to regulatory arbitrage.
USDT and USDC—the largest stablecoins—are largely backed by short-term U.S. Treasuries, though USDT also holds crypto assets. Still, the IMF warns redemption runs could trigger systemic stress. Long-term risks include dollarization, weakened monetary policy, shrinking bank deposits, and reduced government revenue from seigniorage.
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