The head of the Central Bank of Switzerland spoke about the risks of stablecoins for the monetary policy of the statePresident of the National Bank of Switzerland Thomas Jordan argues that stablecoins pegged to foreign exchange rates, under certain circumstances, can impede the implementation of the monetary policy of the state.

The head of the Central Bank of Switzerland spoke about the risks of stablecoins for the monetary policy of the state

The President of the Swiss National Bank Thomas Jordan argues that stablecoins pegged to foreign exchange rates can, under certain circumstances, impede the implementation of the state's monetary policy..

On September 5, Jordan spoke at the University of Basel, where he stated that the possibilities for using cryptocurrencies as a payment instrument, store of value and unit of account are limited, as they are subject to sharp price fluctuations..

“Crypto tokens are more like speculative investment instruments than“ good ”money in terms of their characteristics. Users generally consider money to be “good” if it shows a stable exchange rate over time, is accepted everywhere, and allows for efficient payments. Taking these factors into account, I conclude that crypto tokens are unlikely to be as widespread as money in Switzerland, ”he said..

Separately, Jordan highlighted stablecoins. According to him, a digital token pegged to the Swiss franc will not have a direct impact on the effectiveness of the regulator's monetary policy. However, providing the public with access to the central bank-issued digital currency will increase risks to financial stability and the likelihood of massive withdrawals from banks, he added. “If foreign currency-pegged stablecoins were to come into circulation in Switzerland, it could undermine the effectiveness of our monetary policy,” Jordan admitted..

Earlier, a representative of the National Bank of Switzerland said that the regulator is working closely with the responsible authorities on the issue of the Libra cryptocurrency project, registered in their jurisdiction..

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