Bank of England Governor: "Bank-issued stablecoins pose a threat to financial stability"

There have been claims that if banks issue their own stablecoins (virtual assets pegged to the value of fiat currencies), it could pose a threat to financial stability.

According to Bloomberg on the 14th (KST), Andrew Bailey, Governor of the Bank of England, said in an interview, "It is much more desirable for banks to offer tokenized deposits, in other words, digital versions of existing money, rather than stablecoins." He pointed out, "Stablecoins carry the risk of pulling funds out of the banking system, resulting in a decrease in lendable funds," adding, "This could have a negative impact on the entire financial system."

However, Governor Bailey also said that there are no plans to issue a central bank digital currency (CBDC). He explained, "It would be more reasonable for UK banks to move toward digitalizing deposits rather than issuing a CBDC in response to stablecoins."