The Bank for International Settlements (BIS) has released a key update from its Annual Economic Report 2026 that examines how digital innovations are reshaping money and finance. Issued on 23 June 2026, the analysis concludes that the path forward requires integrating new technologies into the existing two-tier monetary system while keeping public confidence in money intact.
Digital advances are already changing how payments and financial services operate, offering the prospect of greater competition, speed, and efficiency.
At the same time, they introduce fresh risks to macroeconomic and financial stability and prompt fundamental questions about what ensures trust in money when it moves into programmable, digital environments.
The chapter pays particular attention to stablecoins.
These instruments demonstrate how tokenization—the digital representation of assets on programmable platforms—can enable faster and programmable payments.
However, in their current designs, stablecoins do not fully meet the core attributes that underpin trust in money.
They particularly lack “singleness,” the ability for different forms of money to be exchanged at exact par value against central bank money.
Operating on public, permissionless blockchains and incorporating certain design features also creates difficulties around resilience to financial crime, reliable redemption, and smooth interoperability between different ledgers.
While the overall effect on economic growth may remain modest, broader adoption of stablecoins could significantly alter how banks obtain funding and extend credit.
These shifts, in turn, could create financial stability pressures.
The magnitude of any impact would depend on the makeup of stablecoin reserves, the purposes for which the coins are ultimately used, the regulatory framework applied, and how the rest of the financial system responds.
The BIS explores several illustrative scenarios to map out these possible outcomes.
Additional concerns arise from the fact that most existing stablecoins are denominated in US dollars.
Large-scale global demand could amplify the volatility of capital flows and place pressure on monetary sovereignty in economies with comparatively weaker fundamentals.
To modernize the monetary system effectively, the BIS calls for coordinated policy action on two fronts.
In the near term, authorities must address the shortcomings of today’s stablecoin arrangements.
The right regulatory approach will vary depending on whether stablecoins are used primarily for large-scale payments or mainly as investment vehicles.
The research report outlines a vision for bringing the benefits of tokenization into the established two-tier architecture, where central banks serve as the monetary anchor and commercial banks provide services to households and businesses.
A key idea is the development of a “unified ledger” that brings different forms of tokenised money together on a single platform.
This approach could capture the efficiency gains of digital innovation without undermining trust in money.
An early example of this direction is Project Agorá, which is a public-private collaboration involving eight central banks and more than 40 regulated financial institutions.
The prototype explores improvements to wholesale cross-border payments through a shared platform that features a unifying ledger for tokenized commercial bank deposits alongside separate, jurisdiction-specific ledgers for tokenized central bank reserves.
The BIS notes that financial innovation delivers the greatest benefits when supported by institutions, clear legal rules, and effective oversight. By embedding tokenization within the current system rather than allowing parallel structures to develop unchecked, policymakers can steer the evolution of money and finance in ways that serve the public interest..