Coinbase CEO, Bank of France governor clash over stablecoin interest payments

Coinbase CEO Brian Armstrong and Bank of France Governor François Villeroy de Galhau expressed conflicting views on whether stablecoins should pay interest during a panel discussion at the World Economic Forum in Davos, Coindesk reported. Armstrong argued that users have a right to earn a return on their money and that allowing stablecoin interest is necessary for national competitiveness. He noted that China has already permitted interest payments on its central bank digital currency (CBDC), the digital yuan, and stressed that a U.S. ban on such payments would only allow competitors to thrive. In contrast, Villeroy de Galhau contended that private tokens paying interest would pose a risk to the traditional banking system. He stated that he does not believe the digital euro should pay interest, adding that the primary public objective must be to preserve financial stability. The two also disagreed on Bitcoin. Armstrong described the cryptocurrency as more independent than central banks because it lacks an issuer and cannot be controlled by any single entity. Villeroy de Galhau countered that unregulated stablecoins and private currencies could become a political threat, potentially leading to a loss of national monetary sovereignty.