IMF Warns of Stablecoin Risks to Monetary Sovereignty and Financial Stability in New Report
On December 5, 2025, the International Monetary Fund (IMF) released a comprehensive 56-page report warning that stablecoins pose significant risks to monetary sovereignty and financial stability. The report highlights concerns that the use of stablecoins could lead to currency substitution, potentially diminishing a country's control over its own money and monetary policy. It underscores that central bank money should remain the primary and most liquid form of currency.
The IMF cautions that in scenarios involving rapid asset sell-offs, central banks might have to intervene to maintain stability, a concern that aligns with those previously voiced by the European Central Bank and the Bank for International Settlements. Furthermore, the report critiques the crypto industry for lacking adequate controls and regulatory compliance, which may increase vulnerabilities to illicit activities such as money laundering and terrorist financing. This parallels warnings from a 2024 U.S. Treasury report regarding the laundering use of U.S. dollars.
Despite these warnings, industry experts featured in the report suggest that stablecoins and central bank digital currencies (CBDCs) can coexist and potentially support economies with unstable fiat currencies. Erbil Karaman of Human Finance, Kevin Lee of Gate, and Arjun Sethi of Kraken discuss how the evolving nature of money might benefit from such innovations. Ricardo Salinas Pliego also commented on the report, framing anti-crypto campaigns as stemming from fear within traditional banking sectors and established financial institutions.
