DFC

The joint venture AllUnity, formed by banking giant Deutsche Bank and asset management firm DWS, obtained authorization from Germany’s Federal Financial Supervisory Authority (BaFin) to launch a euro-denominated stablecoin. AllUnity was granted an Electronic Money Institution (EMI) license, paving the way for the debut of EURAU, a euro-backed stablecoin fully compliant with the Markets in Crypto-Assets Regulation (MiCA) framework. EURAU will feature a transparent proof-of-reserve system and regular financial reporting. The stablecoin is specifically designed to integrate into the operational flows of regulated institutions, fintech platforms, and corporate treasuries.

[July 2023] The Banque Centrale des Etats de L'Afrique de L'Ouest (BCEA) launched a research project, under the aegis of its FinTech Committee, to assess the utility of issuing central bank digital currency (CBDC) in the West African Monetary Union (WAMU) region (Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal, and Togo). The mandate of the project group is to identify the objectives, challenges, and risks related to the CBDC issuance within WAMU, conduct a feasibility study, including the identification of use cases, prerequisites, key success factors, risk control mechanisms, and design options for CBDCs, assess the potential impact of CBDCs on the roles and activities of the BCEAO, and review potential impact on credit institutions, microfinance institutions, other financial ecosystem players, and financial inclusion.

The Bank of England's (BoE's) Financial Market Infrastructure Executive Director, Sasha Mills, outlined the central bank's vision for digitalizing wholesale financial markets through tokenization of assets and smart contracts on distributed ledger technology (DLT). She pointed to the Bank's updated thinking on settlement assets, particularly allowing systemic stablecoins to be backed by remunerated high quality liquid assets (HQLAs) rather than solely unremunerated central bank deposits. Ms. Mills highlighted progress through the Digital Securities Sandbox and the UK Government's Digital Gilt pilot (DIGIT), while outlining plans for enhanced access to the upgraded real time gross settlement (RTGS) service and exploring synchronization interfaces to enable conditional settlement across different ledger systems. She emphasized that the future financial system will likely be a "mixed ecosystem" where new and old structures coexist, requiring interoperability between different systems, and called for moving beyond theoretical discussions to practical implementation of these digital foundations.Ms. Mills also floated potential holding limits for systemic stablecoins, likely be in the region of £10,000 to £20,000 for individuals and £10 million for businesses.

The United Nations Development Programme (UNDP) published a five-stage methodology for implementing central bank digital currencies (CBDCs) to advance financial inclusion in emerging economies. The methodology progresses through: (1) understanding financial inclusion barriers and user needs, (2) CBDC preparation including cost-benefit analysis and stakeholder coordination, (3) user-centric design and prototyping with emphasis on privacy protection and accessibility, (4) piloting to test assumptions and gather feedback, and (5) full implementation with ongoing monitoring and capacity building. The paper emphasizes that retail CBDCs, when properly designed with features like offline functionality and simplified identification requirements, can address persistent barriers such as high transaction costs, limited documentation, and poor connectivity that exclude underserved populations from traditional financial services. However, the authors stress that CBDCs should be viewed as one component of broader Digital Public Infrastructure rather than standalone solutions, and successful implementation requires robust stakeholder engagement, regulatory frameworks, and continuous adaptation to ensure these digital currencies effectively serve vulnerable populations while maintaining security and sustainability.

Ripple Labs has applied for a national trust bank charter from the Office of the Comptroller of the Currency (OCC) to potentially bring its RLUSD stablecoin under federal regulation as part of a dual-track strategy alongside its existing state-regulated path through Standard Custody & Trust. The application represents a hedging strategy, as federal oversight would provide institutional credibility and improve chances of obtaining a Federal Reserve master account, which would enable direct payments and potentially allow stablecoin reserves to be held at the central bank. However, Ripple faces a significant regulatory challenge: under Basel III banking rules, its substantial XRP cryptocurrency holdings would require dollar-for-dollar capital reserves, while those same XRP holdings cannot be counted as qualifying capital because they are classified as intangible assets—creating a potentially prohibitive capital adequacy problem that could undermine the charter application unless addressed through restructuring, such as routing the charter through a subsidiary like Standard Custody rather than directly through Ripple Labs.

The U.S. National Bureau of Research (NBER) published a paper that develops a calibrated New Keynesian DSGE model featuring monopolistic banks to assess the macroeconomic impact of introducing a remunerated central bank digital currency (CBDC). The analysis shows that households gain from enhanced liquidity services and higher deposit interest rates due to reduced bank market power, while banks experience lower profits and lending volumes. Exploring economies across different interest rate regimes, the authors identify significant welfare improvements from remunerated CBDC adoption, especially in economies with high interest rates where banks have substantial market power in deposit markets. They propose a practical CBDC interest-rate setting rule—setting it as the greater of zero and the policy rate minus one percentage point—which closely approximates the optimal rate found in their model.

This paper by McGill University's Katrin Tinn proposes an "asymmetric privacy" design for central bank digital currencies (CBDCs) to resolve the trade-off between consumer privacy and regulatory efficiency. Traditional payment systems face a dilemma: fully private systems (like cash) protect privacy but create costly auditing problems for taxation and financing, while transparent digital systems enable efficient oversight but cause privacy concerns that distort consumer behavior. The proposed "P-Hybrid CBDC" solution makes consumer spending private (protecting money senders) while keeping firm revenues publicly observable (revealing money receivers), implementable through technologies like Zero-Knowledge proofs or anonymized cards. The theoretical model shows this asymmetric design achieves optimal outcomes by enabling efficient financial contracting and tax collection while minimizing privacy-related market distortions, with welfare benefits increasing at scale. Central banks are well-positioned to implement such systems that maximize utility across all stakeholders while maintaining compliance and privacy.

[June 12, 2025] Stripe will form a deeper partnership with Shopify that will enable millions of Shopify merchants across 34 countries to accept stablecoin payments in USDC (USD Coin). Customers will be able to pay with USDC on the Base blockchain using their preferred crypto wallet, while merchants can choose to receive payments in their local currency deposited to their bank account or transfer funds directly as USDC to an external wallet. Stripe Connect platforms in the U.S. will also be able to enable stablecoin payments for their users.

[June 23, 2025] Fiserv plans to launch a new digital asset platform featuring the FIUSD stablecoin, that will leverage infrastructure from Paxos and Circle, operate on the Solana blockchain, and be available at no additional cost to Fiserv's approximately 10,000 financial institution clients and six million merchant locations that process 90 billion transactions annually. FIUSD is designed to provide banks with 24/7 settlement capabilities and streamlined processes while maintaining full control over customer experience through easy integration with existing Fiserv platforms like Experience Digital and Commercial Center, with built-in compliance features including fraud monitoring and risk management.

(June 10, 2025] Societe Generale-FORGE announced the launch of USD CoinVertible (USDCV), a USD-denominated stablecoin that will be deployed on both Ethereum and Solana public blockchains, with The Bank of New York Mellon Corporation (BNY) serving as reserve custodian. This marks SG-FORGE's second stablecoin after the EUR CoinVertible launched in April 2023, offering institutional, corporate, and retail investors 24/7 instant conversion between fiat currencies and stablecoins for activities like crypto trading, cross-border payments, and cash management. Both stablecoins are fully compliant with European MiCA regulation as Electronic-Money Tokens, with SG-FORGE licensed as an Electronic Money Institution by French regulators, and trading of USDCV is expected to begin in early July 2025, though neither stablecoin is available to US persons.

Crunchfish outlined its Digital Cash solution that uses a modular, packet-switched layer-2 (L2) architecture to enhance existing layer-1 payment systems. The company's approach augments any underlying L1 payment system by enabling multiple design objectives including resilience, privacy, scalability, and interoperability through off-chain processing while maintaining reconciliation and settlement on the underlying L1 system. The solution addresses vulnerabilities in traditional online payment systems by providing load balancing and congestion avoidance during peak usage, enables new offline payment use cases, and maintains a modular design that separates wallet, terminal, and gateway components for flexibility and healthy ecosystem competition. By integrating packet-switching architecture similar to how the internet revolutionized communication layers, Crunchfish's system ensures survivability and load balancing for high-volume payment networks while offering universal interoperability across devices, geographies, and payment systems.

Circle submitted an application to the Office of the Comptroller of the Currency (OCC) to establish a national trust bank, First National Digital Currency Bank, N.A. If approved, the bank would be authorized to operate as a federally regulated trust institution, subject to OCC oversight, and would oversee the management of the USDC Reserve on behalf of Circle’s U.S. issuer. An approval would also further strengthen the infrastructure that supports the issuance and circulation of USDC and would offer digital asset custody services to institutional customers. A federally regulated trust charter would also help Circle meet expected requirements under the proposed GENIUS Act legislation, which would represent a meaningful step forward in integrating digital assets into the broader U.S. financial system.

The Swiss National Bank (SNB) is extending and expanding Project Helvetia, which examines various approaches to settling tokenized assets in central bank money, for a further year and continue the pilot until at least mid-2027. (The project was slated to end a two-year extension on June 2026.) Additionally, the SNB is expanding Project Helvetia to include the settlement of tokenized assets with traditional central bank money through a real time gross settlement (RTGS) link, providing BX Digital with a production environment to test this approach alongside the existing wholesale central bank digital currency (CBDC) settlement on the SIX Digital Exchange platform. The extension allows for a direct comparison between the two settlement approaches in a production environment to provide further insights into their respective advantages and disadvantages.

Danmarks Nationalbank published a paper that examines how distributed ledger technology (DLT) could transform financial market infrastructure while maintaining the critical role of central bank money in interbank settlements. The paper explains that while DLT platforms offer potential benefits like streamlined capital markets, automated smart contracts, and reduced intermediaries, they currently cannot integrate with central bank money systems, creating risks of market fragmentation and reduced monetary policy effectiveness. To address this challenge, central banks are exploring two main approaches: connecting existing central bank systems to DLT platforms through interoperability solutions, or developing new systems where central bank money and digital assets operate on the same DLT platform. The analysis emphasizes that regardless of technological advances, maintaining central bank money as the primary settlement asset is essential for financial stability, and Denmark will collaborate with the European Central Bank (ECB) through the TARGET Services platform to ensure future settlement infrastructure developments benefit the Danish financial system while preserving the unique safety and liquidity properties of central bank money.

The GENIUS Act's Section 11 establishes comprehensive insolvency protections for payment stablecoin holders by fundamentally restructuring bankruptcy priorities and procedures. The Act grants stablecoin holders first priority claims over all other creditors, including administrative expenses, ensuring they have primary access to required reserves and any remaining unencumbered assets of the debtor. It addresses potential gaps by deeming all stablecoin holders to have valid claims regardless of contractual terms, while excluding required reserves from the bankruptcy estate to prevent other creditors from accessing these funds. However, the Act creates some operational tensions by subjecting these excluded reserves to the automatic stay, requiring a court-approved process for redemption that could delay access by more than two weeks. The legislation also mandates that insolvency proceedings for regulated depositories be handled by appropriate federal or state regulators, and requires a comprehensive study of potential legal gaps in stablecoin insolvency law within three years of enactment.

The Bank of Korea (BOK) has reportedly temporarily suspended preparations for the second phase of its wholesale central bank digital currency (CBDC) pilot that had been scheduled for the fourth quarter of 2025. The first phase of "Project Hanging River", which was aimed at building a programmable and interoperable CBDC network to support a tokenized financial ecosystem, ended on June 30, 2025. The decision comes as the government pushes a won-based stablecoin-focused agenda.

Banco Central de Bolivia (BCB) reported that crypto-asset (most likely all USDT stablecoin) transactions soared from $46.5 million in the first half of 2024 to $294 million in the same period of 2025. Crypto-assets were outlawed in Bolivia until June 2024. but since the ban was lifted, transaction volumes have reached $430 million across more than 10,000 individual operations. This is occurring amid Bolivia's severe economic crisis, which includes near-zero dollar reserves, 40-year high inflation, fuel shortages, and a currency that has lost half its value on the black market despite an artificially maintained official exchange rate. The central bank noted that these digital payment tools have facilitated access to foreign currency transactions, including remittances and small business payments, benefiting micro and small business owners and families nationwide during the ongoing dollar scarcity crisis.

RISK has made freely available a 2021 article by Charles Kahn and Manmohan Singh that argues that stablecoins pose fundamental challenges to traditional monetary policy because, unlike conventional bank money that must be backed by central bank reserves, stablecoins are backed by short-term government securities, commercial bank deposits, and other high-quality liquid assets. This creates a parallel currency system outside central bank control, potentially reducing its ability to influence money supply through monetary policy operations. The authors suggest that to maintain monetary policy effectiveness, central banks should consider allowing stablecoin issuers direct access to central bank reserves and payment systems, essentially treating them like banks.

The IMF published a paper that takes stock of developments and policy issues related to digital payments innovations across sub-Saharan African (SSA) drawing on insights from a recent IMF survey of SSA central banks. The paper highlights the critical role of robust digital infrastructure and promotes a competitive, interoperable ecosystem with active private‑sector participation. Mobile money and fast payment systems (FPS) are encouraged as the cornerstone of financial inclusion. Central bank digital currency (CBDC) is seen as a complementary tool but only justified when clear market failures exist.

[April 13, 2023] The German Banking Industry Committee (GBIC) has published a comprehensive working paper on the evolution of commercial bank money. It describes the design principles for a Commercial Bank Money Token (Tokenized Commercial Bank Money, CBMT) as well as the mechanisms for its issuance and multi-currency capability.

The European Parliament ECON Committee published a paper that analyses whether dollar-denominated stablecoins pose risks to European monetary policy and assesses the potential of the digital euro as a countermeasure. It concludes that large-scale adoption of foreign stablecoins in Europe is unlikely due to strong trust in the euro, advanced local payment systems, and regulatory barriers like MiCA. Although stablecoins could theoretically disrupt interest rate transmission, bank lending channels, and exchange rate dynamics, these impacts are minimal under current conditions. The paper argues that the digital euro could offer a credible public alternative to stablecoins, but warns its effectiveness depends on design choices such as holding limits, privacy guarantees, and costs to merchants. Ultimately, while stablecoins currently pose little threat, continuous monitoring is recommended, and the digital euro’s success will hinge on addressing user needs and competitive functionality.