Agustin Carstens, the head of the Bank for International Settlements (BIS), has declared that cryptocurrencies have lost the "battle" against fiat currencies issued by central banks worldwide. Speaking at the Monetary Authority of Singapore, Carstens emphasised that stablecoins are unreliable because they lack the "institutional arrangements and social conventions behind them." According to Carstens, only the legal and historical infrastructure behind central banks can provide great credibility to money. He believes that cryptocurrencies have already lost the battle to national currencies like the euro, pound, and yen, and insists that technology alone cannot create "trusted money."

Carstens used stablecoins as an example during his speech, noting that they cannot guarantee the singleness of money. He believes that the events of the past year have raised concerns about whether stablecoins can function as money. Carstens thinks that stablecoins rely on the credibility of fiat with fewer regulatory protections, making them unable to ensure the unity of money. In contrast, central bank digital currencies could provide safe and stable money.



Carstens concluded by warning that it is important for financial incumbents, particularly central banks, to contribute to this type of innovation. He argues that central banks need to innovate, or others will step in. He also emphasizes the importance of ensuring that stablecoins do not harm investors and consumers or contribute to a fragmentation of the monetary system that undermines the singleness of money.

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