The Bank for International Settlements is renewing its criticism of stablecoins, questioning whether they can credibly serve as everyday money as governments worldwide build regulatory frameworks around the tokens. BIS General Manager Pablo Hernández de Cos, a candidate to succeed European Central Bank President Christine Lagarde next year, said stablecoins do not credibly function as a means of payment at scale and argued that tokenized bank deposits offer a stronger alternative. According to Cointelegraph, de Cos said tokenised deposits provide a more direct way to use tokenisation while preserving the foundations of the monetary system. His remarks come as regulators continue to assess stablecoin adoption, while a new study from the BIS-linked Financial Stability Institute shows major differences in how leading markets regulate stablecoin issuers. Hernández de Cos also acknowledged that stablecoins could lower government borrowing costs, echoing an argument made by US Treasury Secretary Scott Bessent, but said the effect could also raise costs for consumers if bank deposits shift into stablecoins and banks pass higher funding expenses on to households and businesses through higher borrowing rates. He added that stablecoin platforms face limited interoperability and persistent challenges in applying anti-money laundering controls consistently. He also said wider use of US dollar-pegged stablecoins outside the US could weaken monetary sovereignty and domestic monetary policy.