IMF warns of stablecoin impact on monetary sovereignty and recommends limits to prevent substitution risks

The Hash World News reports that the International Monetary Fund (IMF) has issued a warning in its report (Understanding Stablecoins) pointing out that dollar-dominated stablecoins are rapidly penetrating emerging markets and developing economies, which may impact central banks' control over domestic liquidity and interest rates. The report states that stablecoins are quickly commercialized through mobile phones and the internet, especially in non-custodial wallets, which can easily trigger the phenomenon of 'currency substitution', thereby weakening the use of local currency and affecting the transmission of central banks' monetary policy and seigniorage revenue. The IMF recommends that countries establish legal frameworks to prevent stablecoins from being recognized as 'legal tender' or 'official currency', thus protecting financial sovereignty. Currently, 97% of the total market value of stablecoins is pegged to the US dollar, with only a small number linked to the euro or yen. The report emphasizes that the use of stablecoins for cross-border payments and in high-inflation countries is increasingly growing, especially in Africa, the Middle East, and Latin America.