Oliver Wyman has noted that since the 1944 Bretton Woods conference established the postwar financial framework nearly eight decades ago, central banks and regulators have held primary responsibility for maintaining monetary stability. Oliver Wyman pointed out that they have overseen both government-issued currency and the broader money supply created through commercial banking.
Today, however, this established order faces unprecedented pressure from the rapid expansion of stablecoins—privately issued digital assets designed to maintain a steady value, most often pegged to the U.S. dollar.
These instruments differ fundamentally from traditional money.
They transfer value across borders almost instantly, operate primarily through mobile applications rather than bank accounts, and function without direct dependence on any single government’s backing.
As dollar-denominated stablecoins gain traction, experts warn they could erode the effectiveness of national monetary policies and reshape how economies manage money itself.
According to a new February 2026 report by Oliver Wyman consultants Joseph Noss, Dominik Weh, Dominik Treeck, and Maria Fernandes, stablecoins have already moved beyond their origins in cryptocurrency trading.
They now serve everyday purposes: facilitating retail payments, enabling cross-border remittances, and acting as reliable stores of value in volatile environments.
In one Latin American nation experiencing annual inflation exceeding 100 percent, more than 100 online merchants now accept stablecoins for transactions.
Across various other world regions, where foreign currency access remains limited amid inflation and exchange-rate swings, these digital tokens are capturing a growing share of remittance flows.
The International Monetary Fund estimates that cross-border stablecoin transaction volumes reached approximately $2 trillion in 2024 alone.
This shift carries significant risks for monetary sovereignty.
When households and businesses increasingly hold and transact in foreign stablecoins, central banks lose influence over domestic money conditions. Interest-rate adjustments and reserve requirements become less effective when substantial portions of economic activity occur outside the regulated banking system.
Banks themselves face competitive pressure as customers migrate deposits to stablecoin wallets, potentially raising funding costs and reducing profitability margins.
The European Central Bank and Bank of England have both highlighted how such substitution could undermine financial resilience.
In times of crisis, the speed of digital networks accelerates capital flight: what once took years of gradual currency substitution can now unfold in months, intensifying exchange-rate volatility and complicating crisis management.
Policymakers worldwide are weighing three broad strategies in response.
Some jurisdictions, including China and certain Gulf states, have chosen strict prohibition—banning crypto trading and stablecoin activities to safeguard capital controls and domestic currency dominance.
While this approach preserves short-term control, it risks driving innovation offshore and creating enforcement challenges.
Others are pursuing competition by developing state-backed alternatives.
Japan’s 2023 regulatory framework, for instance, permits licensed banks and trust companies to issue yen-pegged stablecoins, offering a domestic option that retains public oversight.
Central bank digital currencies (CBDCs) represent another avenue for maintaining relevance in the digital economy.
A third path involves managed integration: authorizing stablecoin issuers under robust rules covering capital reserves, liquidity requirements, and guaranteed redemption at par.
The United Kingdom’s Treasury and Bank of England have advanced proposals along these lines, aiming to harness innovation while embedding safeguards.
The Oliver Wyman analysis emphasizes that these choices will not only determine domestic financial stability but also influence the broader international monetary architecture.
Fragmented or inconsistent regulatory approaches could undermine public confidence in money and institutions. As stablecoins continue their transition from niche crypto tools to mainstream financial instruments, the decisions made by regulators today will define who ultimately controls the future of money.