The BIS at Jackson Hole: Why Tokenised Deposits Beat Stablecoins
At the Federal Reserve's Jackson Hole Economic Symposium on 28 August 2026, the Bank for International Settlements (BIS) took one of its clearest public positions yet on the future of digital money: tokenised deposits — not stablecoins — should carry the bulk of everyday payments going forward. BIS General Manager Pablo Hernández de Cos argued that stablecoins, in their current form, "do not yet uphold the foundational properties of money," and that central-bank-anchored tokenised bank money offers a sounder foundation for programmable finance.
The intervention matters because it reframes a debate that has quietly split global policymakers. Until now, most public attention has focused on two binaries: CBDC versus cash, and stablecoins versus fiat rails. The BIS is drawing a different line — between private tokens that float outside the banking system, and tokenised deposits that stay inside it.
What the BIS Actually Said
Hernández de Cos's core argument is structural. Both stablecoins and tokenised deposits use tokenisation — the same programmable ledger technology. But they sit in fundamentally different places within the monetary system.
- Tokenised deposits remain claims on regulated commercial banks, settled ultimately in central bank money, and redeemable at face value. They preserve the link between deposits and lending that underpins credit creation.
- Stablecoins, by contrast, are transferable tokens whose redemption to par can depend on secondary-market trading. Transfers between different stablecoins (say USDT to USDC) may require trades where prices deviate from intended value — especially under stress.
The BIS also flagged two further frictions. Stablecoins operate across fragmented blockchains, complicating interoperability and settlement. And self-custodied wallets make anti-money-laundering and know-your-customer checks harder to enforce than on regulated bank rails.
Why it matters: The BIS is the central bank of central banks — 63 members, including the Federal Reserve, the ECB, and the People's Bank of China. When its General Manager tells a room of the world's most senior monetary policymakers that stablecoins aren't credible money at scale, it signals how regulators are likely to treat them in the next phase of rulemaking.
The Lending Concern Beneath the Surface
Beneath the technical critique sits a deeper anxiety about financial stability. The BIS warned that wider stablecoin adoption could raise bank funding costs, restrict lending, and expose markets to runs — the impact depending on whether issuers hold reserves in bank deposits, government securities, or central bank reserves.
Tokenised deposits, by keeping funds inside the banking system, preserve the deposit-to-lending transmission channel. Stablecoins, in aggregate, risk draining that channel if households and firms shift balances from bank deposits into tokenised dollars held in self-custody.
The BIS also noted a monetary-sovereignty concern: growing demand for US dollar-backed stablecoins could weaken monetary sovereignty in smaller economies — a live issue for emerging markets where dollarisation via stablecoins is already observable.
Not a Winner-Take-All Verdict
The message was not that stablecoins will disappear. Hernández de Cos sketched a coexistence scenario: tokenised deposits supporting most everyday payments and wholesale settlement, while stablecoins serve "specialised uses under stronger safeguards." That is broadly consistent with the GENIUS Act in the US and MiCA in the EU, which regulate stablecoins rather than ban them.
The BIS is also candid about tokenised deposits' own gaps. No interoperable tokenised deposit network currently spans multiple banks and jurisdictions. Separate bank-operated networks could limit interoperability and favour the largest institutions. Wider adoption would require common technical standards, clear governance, legal certainty, and stronger cybersecurity.
Central banks are actively working on those gaps. The BIS-led Project Agorá — testing tokenised cross-border wholesale payments with dozens of institutions and central banks — is precisely the kind of shared infrastructure the BIS wants to see. And SWIFT's recent live tokenised deposit transfer between HSBC and Standard Chartered, which TokenKnowlogy covered last week, shows the private rails maturing in parallel.
What to Watch
Jackson Hole speeches don't set policy, but they set tone. The BIS has now placed tokenised deposits — not stablecoins, and not retail CBDC — at the centre of its vision for digital money. Expect this framing to filter into upcoming standard-setting work at the BIS's Committee on Payments and Market Infrastructures and the Financial Stability Board, and into the G20's digital-finance agenda ahead of the Miami summit in December.
For issuers, the implication is clear: the era of stablecoins as unregulated, borderless dollars is closing. The open question is whether they evolve into regulated, bank-adjacent instruments — or get outcompeted by tokenised deposits that offer the same programmability without leaving the banking system. The BIS has made its bet.