ZAGREB, Croatia — Federal Reserve Governor Christopher Waller said the increasing adoption of stablecoins could strengthen the global influence of U.S. monetary policy, while dismissing central bank digital currencies as unnecessary and largely unsupported by consumers.
Speaking during a panel discussion in Croatia, Waller said countries that adopt stablecoins tied to the U.S. dollar effectively import U.S. monetary conditions.
“Countries that adopt it, it’s like a fixed exchange rate system,” Waller said, according to Bloomberg. “You are going to import U.S. monetary costs, so it’s broadening the reach of U.S. monetary policy in countries that use more stablecoins.”
Bloomberg noted that Waller has previously expressed support for stablecoins. Last year, he argued that dollar-backed stablecoins could help reinforce the U.S. dollar’s status as the world’s primary reserve currency, while also calling for clear regulatory standards governing the digital assets.
Criticism of Other Central Banks
At the same event, Waller criticized efforts by central banks to develop their own digital currencies, saying he remains unconvinced they address any significant problem.
“There’s nothing that requires a CBDC and only a CBDC to fix,” Waller said, according to Bloomberg, describing central bank digital currencies as a “solution in search of a problem.”
Waller also suggested that global enthusiasm for CBDCs has waned.
“That’s why almost every major central bank in the world has just stopped” pursuing them, he said, according to Bloomberg. “They just can’t find a reason for this.”
ECB, China Active in CBDCs
Bloomberg reported that Waller said only the European Central Bank and China continue to actively pursue CBDC projects.
“Two banks, and nobody in China uses the thing anyway — they like WhatsApp and Alipay, they don’t even use the stupid thing,” Waller said.
His comments drew a response from incoming European Central Bank Vice President Boris Vujcic, who moderated the panel discussion. According to Bloomberg, Vujcic challenged Waller’s assertion that central banks have largely abandoned CBDC efforts, noting that “21 western central banks” in the euro area have supported moving forward with a digital euro initiative.
The debate highlights growing differences between U.S. and European policymakers over the future of digital money.
Bloomberg noted that ECB officials, including President Christine Lagarde, have expressed concerns about the rise of stablecoins. In a speech earlier this month, Lagarde warned that even euro-denominated stablecoins could threaten financial stability and weaken the transmission of monetary policy.
