ECB board member warns stablecoins could risk financial stability

Isabel Schnabel, a member of the European Central Bank's (ECB) executive board, warned that stablecoins could pose several risks to financial stability and monetary policy. Speaking today at the Bank of Korea's international conference in Seoul, Schnabel noted that while stablecoins could offer significant benefits, they also increase the risk of bank runs and could weaken the effectiveness of interest rate decisions, Bloomberg reported. She added that stablecoins could also reinforce the international dominance of the U.S. dollar. Schnabel emphasized that the ECB's best response is to ensure public funds continue to serve as an anchor for the financial system.