The Health Employees Superannuation Trust Australia (HESTA) and ANZ are examining whether the bank’s A$DC stablecoin could allow HESTA to streamline pension payment reconciliation. Currently, HESAT member firms contributing to staff pensions pay the money across and separately send data about what it relates to. ANZ’s idea is for the data to accompany the stablecoin payment as part of a smart contract. This could eliminate the entire reconciliation process and employees would be able to see their contributions in real time.
Paxos debuts new stablecoin payment platform with Stripe
Paxos launched a new stablecoin payments platform targeting payment service providers (PSP) and Fintechs that want to enable stablecoin payments. Global payment processing company Stripe will be the first PSP to integrate the new platform into its system. The infrastructure will be featured on Stripe’s Pay with Crypto product, which allows users to accept stablecoin payments settling in fiat currencies. Once a stablecoin payment is received via Paxos, users can choose whether to immediately convert to fiat currency and settle in local currency, or pay out stablecoin balances directly to merchants. Merchants will have the ability to issue refunds by instantly converting fiat into the stablecoin originally used, then sending directly to the wallet used in the initial payment. https://paxos.com/blog/paxos-launches-new-stablecoin-payments-platform/https://docs.stripe.com/crypto/integrate-pay-with-crypto
Stablecoins, money market funds and monetary policy
The European Central Bank (ECB) published a paper that documents the very different short-term (12-week) responses of stablecoins and money market funds (MMFs) to crypto and U.S. monetary policy shocks since 2019. It shows that crypto shocks are inconsequential for MMFs and traditional financial markets but negatively affect stablecoins. In contrast, U.S. monetary policy shocks significantly affect MMFs and stablecoins, but in opposite directions. While prime MMF assets grow after contractionary monetary policy shocks, stablecoin market capitalization significantly declines.
LVGA are a local stablecoin. They can be purchased within the MyLugano app and collected through the cashback while shopping at local affiliated shops. Unlike other cryptocurrencies such as Bitcoin LVGA can be used only in Lugano and once obtained they cannot be exchanged or traded for other currencies. LVGA are not subject to fluctuation being "pegged" to the Swiss franc. Thus, they have no speculative intent but exists solely and exclusively as a form of incentive for local spending in Lugano.
Runs, Transparency and Regulation: On The Optimal Design of Stablecoin Frameworks
The European Banking Authority (EBA) published a paper that shows how transparency incentivizes stablecoin issuers to keep a larger share of the reserves in liquid assets, thus reducing the risk of runs and potential bankruptcy ex–ante. In addition, transparency on reserves disincentivizes stablecoin holders from irrationally demanding reimbursement of their funds. The paper’s results also suggest that regulatory interventions after a run has become imminent, in the form of a suspension, can still reduce the negative impact of potential bankruptcy on holders, and that letting assets mature after imposing the suspension can deliver the first–best social welfare outcome. Overall, the paper builds the case for close monitoring by supervisory authorities, overcollateralization, and tight disclosure rules.
State of Stablecoins: Sector Expansion & A Changing Interest-Rate Environment
Coinmetrics published an update on stablecoin markets. It finds that stablecoin flows have turned positive, pushing total supply above $160 billion towards record-highs. The stablecoin landscape continues to expand in diversity, use cases, and risk profiles, from fiat-collateralized and crypto-backed to interest-bearing and protocol-native stablecoins. With stablecoin collateral increasingly composed of U.S dollar equivalents and real-world assets, changes in the interest rate environment could impact profitability and attractiveness of various stablecoins.
Russia Close to Starting Trials of Crypto Payments, Exchanges
On September 1, 2024, Russia will reportedly soon start trials of cryptocurrency exchanges and the use of digital tokens for cross-border transactions to help firms circumvent international sanctions. It will use Russia's National Payment Card System (NPCS) to swap between rubles and cryptocurrencies. The NPCS already features infrastructure for functions like interbank settlement and clearing, and it is overseen by the central bank. According to Ledger Insights, stablecoins pegged to Chinese yuan and a BRICS currency basket will feature in the trials. https://www.ledgerinsights.com/russia-plans-stablecoins-2-crypto-exchanges-to-circumvent-sanctions/
Abu Dhabi Proposes Fiat Stablecoin Regulatory Framework
The Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market (ADGM) has published Consultation Paper No. 7 of 2024 containing proposals to enhance its regulatory framework to allow the issuance of Fiat-Referenced Tokens (FRTs). It adopts adopt a risk-based and proportionate approach based on appropriate regulatory requirements that incorporate the necessary safeguards to ensure that FRT issuers operate in a safe and sound manner and informed by current practices in leading jurisdictions. The latter include the New York Department of Finance, the European Union's Markets in Crypto-Assets Regulation, the Monetary Authority of Singapore, HM Treasury and the Financial Conduct Authority in the United Kingdom, and the Hong Kong Monetary Authority. https://adgmen.thomsonreuters.com/rulebook/consultation-paper-no-7-2024-proposed-regulatory-framework-issuance-fiat-referenced-tokens
Tether plans to launch a stablecoin pegged to the United Arab Emirates dirham (AED) fully backed by liquid UAE-based reserves. It will launch in collaboration with UAE-based Phoenix Group and Green Acorn Investments. It will join Tether’s slate of stablecoin products that include USDT, EURT, CNHT, MXNT, XAUT and aUSDT.
The Republic of Palau’s Ministry of Finance reported the successful completion of Phase 2a of its National Government Payment Service Project. Phase 2a involved integrating a Ripple-based stablecoin system into Palau’s financial infrastructure. Phase 2b aims to continue the development of the ecosystem, with a specific focus on integrating more comprehensive financial, legal, and business frameworks. This phase will also address the scalability of the payment system and ensure its robustness against potential security threats. https://www.palaugov.pw/wp-content/uploads/Palau-National-Payment-System-Phase-2a-Final-Report.pdf
Stablecoins and the New Payments Landscape
Coinbase believes stablecoins represent the next major leap forward for payments and capital movement, particularly as it’s becoming easier for merchants and other entities to integrate this technology into their economic workflow – even compared to a couple years ago. Most recently, Coinbase announced a partnership with payments provider Stripe to offer USDC on Base for crypto payouts and on their fiat-to-crypto onramp, while Visa, Mastercard and PayPal have all launched their own stablecoin initiatives in recent years. Other notable mentions include Shift4, Nuvei, Worldpay and Checkout.com. That said, stablecoins require greater regulatory clarity and a smoother crypto user experience to more firmly establish the foundations for their potential.
Moody's published a paper on the multiple risks of fiat-backed/pegged stablecoins. "As the number of stablecoins grows, they are more frequently being used in traditional finance, where they have the potential to lower transaction fees and make cross-border payments more efficient. Moreover, stablecoins are increasingly used to buy and sell securities, filling the void caused by the current absence of wholesale central bank digital currencies (CBDCs) compatible with distributed ledger technology (DLT). However, stablecoins are subject to multiple risks and have therefore not always lived up to their promised stability."
Project Pyxtrial: monitoring the backing of stablecoins
The BIS and the Bank of England have have developed a prototype data analytics pipeline which includes data collection, storage and analysis, that can provide supervisors with near real-time data about stablecoins' liabilities and their backing assets. Pyxtrial can provide insight into whether the backing assets exceed their liabilities at all times, and enhance the efficiency and responsiveness of the monitoring process, which helps supervisors to respond faster to potential risks.
28th Meeting of the Digital Euro Scheme Rulebook Development Group (ECB)
The European Central Bank (ECB) posted the outcome of the 28th Digital Euro Rulebook Development Group meeting (10 March 2026) reviewed work on ecosystem fit, the digital euro app, user journeys and minimum user-experience requirements, and additional clarifications on offline functionality, including thresholds, recovery and terminal readiness. It discussed risk management (including financial crime, privacy, reputational and multi-account risks), reuse of PCI and other security standards, and updates to front- and back-end implementation specifications, including alignment with ISO 20022 and Berlin Group structures and separation of authorisation and settlement. The group launched a new terminal/ATM workstream (G5), considered rulebook v0.9 consultation updates, and addressed scheme-wide timeouts and potential deep-dive sessions. [ECB]
27th Meeting of the Digital Euro Scheme Rulebook Development Group (ECB)
The European Central Bank (ECB) posted the outcome of the 27th Digital Euro Scheme Rulebook Development Group meeting (27 January 2026). It was agreed to launch two new workstreams on terminal/ATM providers and on the certification and approval framework, reviewed the ECB’s proposed offline digital euro solution, and discussed risk management including use of a digital euro fraud risk score and alignment with the Payment Services Regulation. The group noted progress on cooperation with standardisation bodies (Nexo, ECPC, Berlin Group, EPC), handling of comments on rulebook v0.9, preparation of a limited digital euro pilot with selected payment service providers and merchants, and forthcoming batches of minimum user experience requirements and implementation specifications. [ECB]
Digital Shekel Project: Progress Report 2025 (Bank of Israel)
The Bank of Israel published an update on its digital shekel project that is progressing toward an end‑2026 issuance decision, concluding that expected macroeconomic benefits are likely to exceed the associated costs. The analysis found that disintermediation risk is low under appropriately calibrated holding limits, with policy rate cuts and liquidity injections (via short‑term Bank of Israel bill redemptions) sufficient to offset deposit outflows except under extreme scenarios. A decentralized supervisory model is proposed, with existing financial regulators overseeing their respective digital shekel participants under a uniform Bank of Israel rulebook. A unified multipurpose infrastructure for retail and wholesale use is found technologically feasible and preferable to separate systems. Open questions include whether the digital shekel should be remunerated, offline payment double‑spend prevention, and retail‑versus‑wholesale sequencing. In addition, a quantitative survey of small businesses found that only one‑fifth expressed interest in using digital shekels, citing satisfaction with existing digital payment methods, although they indicated general interest in a digital shekel if it were to offer lower fees than current digital payment methods. A qualitative survey of large corporations also found lukewarm interest in using a digital shekel, with respondents mainly viewing it as potentially relevant for internal settlement and treasury operations rather than for customer‑facing retail payments, and stressing the importance of compatibility with existing systems. [Bank of Israel]
eCurrency Launches ISO 20022 Compliant CBDC-to-RTGS Implementation (PR Newswire)
eCurrency has productized an ISO 20022‑compliant interface between its central bank digital currency (CBDC) platform and a real‑time gross settlement (RTGS) system, now live at the Bank of Jamaica, enabling real‑time CBDC issuance, settlement, and lifecycle management over standard RTGS messaging rails. The implementation embeds the eCurrency retail CBDC platform as a participant in a Montran‑type RTGS environment, using ISO 20022 messages as the interface layer for issuance, redemption, and high‑value CBDC funding movements. In structural terms, the RTGS system continues to operate as the central bank’s settlement asset ledger and queue manager, while the CBDC platform manages retail‑level token creation, destruction, and lifecycle. RTGS accounts are debited or credited in real time when CBDC is issued to, or redeemed from, intermediaries, with those events triggered and synchronized via ISO 20022 messages rather than proprietary APIs. [PR Newswire]
BOE DLT Innovation Challenge 2025: Final Report (BOE)
The Bank of England (BOE) reported on explorations, carried out in September–October 2025 with nine firms, to see if wholesale central bank money can be transacted and settled on an external programmable ledger not controlled by the central bank. It concluded that DLT can technically speed wholesale settlement and improve throughput but only by accepting material trade‑offs in finality, governance, and resilience. Designs that deliver faster, more “deterministic” settlement tend to shift risk and trust assumptions, weakening decentralization or operational robustness relative to established real‑time gross settlement systems. Scalability enhancements add architectural complexity and create new dependencies that interact negatively with control and resilience requirements. Interoperability solutions with other DLT and legacy systems rarely eliminate trust or operational dependencies; instead they reallocate them across networks or third parties, including off‑chain components for permissionless ledgers. Overall, the trials suggest no dominant DLT architecture for wholesale settlement and frame the policy problem as one of choosing which trade‑offs in speed, control, and governance are acceptable. Further targeted DLT experiments are planned for 2026. [BOE]
CBDC From Global Challenges to Implementation in Kazakhstan (NPCK)
The National Payment Corporation of Kazakhstan (NPCK) published a survey of global central bank digital currency (CBDC) implementation experience to frame Kazakhstan's Digital Tenge rollout, arguing that a phased, programmability-first approach centered on government-to-business use cases can overcome five identified adoption barriers: low public awareness, high bank integration costs, uncertain banking-sector benefits, distributed ledger technology scalability limits, and competition from established payment instruments. For institutional design, the report advocates a two-tier model (central bank issues, commercial banks and fintechs distribute), holding limits and a reverse-waterfall mechanism to contain deposit outflow risk, and non-DLT distributed databases for high-volume retail transactions. The Kazakhstan-specific case emphasizes automated VAT refunds, targeted budget fund marking, and agricultural payment escrow as priority use cases. [NPCK]
The Future of Programmable Payments: Why CBDC and Stablecoins Need Each Other (LinkedIn)
The Future of Programmable Payments: Why CBDC and Stablecoins Need Each Other (LinkedIn)
The Bank of Israel's Assaf David-Margalit posted a nice interpretation of the Bank of Canada's recently published "to tokenize or not to tokenize" working paper. Assaf argues that tokenized central bank digital currencies (CBDCs) and regulated stablecoins should operate as complementary infrastructure layers rather than rivals. The Bank of Canada's paper's core insight is that a tokenized CBDC establishes a "technological floor" by offering superior collateral efficiency—eliminating default risk allows the central bank to support transaction volumes with lower collateral requirements, crowding out inefficient stablecoins through market discipline. Assaf distinguishes programmable payments infrastructure (capable of interacting with smart contracts) from programmable money (which would compromise fungibility), asserting that CBDC should provide the settlement layer while private stablecoins innovate at the application layer using CBDC as the reserve asset. [LinkedIn]
After Acacia: The Next Era of Financial System Innovation? (RBA)
[March 25, 2026] Reserve Bank of Australia (RBA) Assistant Governor Brad Jones foreshadowed the conclusions from the Project Acacia. Assisted with regulatory relief from ASIC and AUSTRAC, industry participants in Project Acacia explored 20 use cases involving a range of assets, forms of money and settlement arrangements. It found that tokenisation and related infrastructure changes can materially reduce settlement frictions, counterparty risk and manual processing in wholesale markets, especially in fixed income and term deposits, and support new asset structures and investor segments, However, large‑scale adoption is constrained by entrenched network effects, legal uncertainty (enforcement of on‑chain records, settlement finality, licensing perimeter, prudential treatment) and the absence of a coordinated public‑private strategy to scale from pilots to commercial deployment. [RBA]
To Tokenize, or Not to Tokenize: The Design Question for a CBDC (Bank of Canada)
The Bank of Canada published a paper that develops a general equilibrium model to assess whether a central bank digital currency (CBDC) should be tokenized—deployable on programmable ledgers to compete with stablecoins—or non-tokenized and confined to off-chain markets, where traditional and crypto banks coexist. Tokenization matters for equilibrium only when collateral use differs across sectors; the three governing structural parameters are crypto-bank pledgeability, crypto-asset scarcity, and the social valuation of on-chain transactions. For institutional design, tokenized CBDC crowds out stablecoins and improves welfare when crypto banks are unreliable and crypto collateral is scarce, whereas non-tokenized CBDC may dominate when on-chain activity is less socially desirable or bond-collateral reallocation to the crypto sector is itself welfare-improving; both forms reduce bank lending, posing a payment-efficiency-versus-intermediation trade-off. [Bank of Canada]
Legal Tender -A Barbarous Relic in the Digital Currency Era (SSRN)
In a paper posted on SSRN, Christian Pfister argues that granting legal tender status to retail central bank digital currency (CBDC) in advanced economies is a conceptually weak and potentially distortionary extension of a historically contingent, often obsolete institution. The paper critiques recent IMF legal analyses for presuming a “digital cash” equivalence and for conflating the unit of account, the issuer, and specific payment instruments when defining legal tender. Pfister shows that modern payment efficiency, financial inclusion, and safety can be achieved through regulation and public infrastructure without legal tender, and that combining legal tender status with regulated aggressive pricing of public rails could crowd out deposits, weaken bank intermediation, and recreate public “walled gardens.” This raises a core design question: whether any residual role for legal tender should attach to the unit of account, central bank liabilities, or particular instruments, and how to do so without impairing monetary transmission, competition, or innovation. [SSRN]
The BCEAO Invites Submissions for Research on Financial Inclusion (BCEAO)
The Central Bank of West African States (BCEAO) is inviting submissions for the 2026 Abdoulaye FADIGA Prize, which rewards high‑quality economic research on West African Economic and Monetary Union (WAEMU) economies. It explicitly invites research on financial inclusion and digital innovation, including work on how cryptocurrencies, mobile money, central bank digital currencies, and fintech can expand access to financial services in WAEMU, while rigorously assessing associated risks, regulatory and supervisory implications, and their interaction with payment systems, financial stability, and monetary policy transmission in the Union. [BCEAO]
Central Bank Digital Currency and Monetary Architecture (Dirk Niepelt)
In a literature review that has been accepted for publication by the Journal of Economic Literature, Dirk Niepelt argues that the macroeconomic consequences of retail central bank digital currency (CBDC) depend primarily on the policy choices accompanying its introduction. Organizing the survey around a neutrality result, the paper demonstrates that bank disintermediation does not independently constitute a source of non-neutrality, provided the central bank recycles CBDC proceeds to banks on deposit-equivalent terms. Most existing research conflates policy-contingent with fundamental sources of non-neutrality, obscuring the extent of policymaker control. Because CBDC represents a structural shift in monetary architecture rather than a technical payment upgrade, it raises political economy questions that exceed the conventional mandate of central banks. [Niepelt.ch]
BOE Considers Keeping Digital Pound On Ice (Bloomberg)
The Bank of England (BOE) and HM Treasury (HMT) are reportedly considering slowing down the digital pound project to defer making an immediate firm decision to approve or scrap it. Officials have been encouraged by private-sector innovation—especially tokenized deposits—that could deliver many CBDC benefits (faster, cheaper payments) within the existing regulated banking system, reducing the urgency to build a central-bank solution. The project has faced skepticism from the public, Parliament, and even BOE Governor Andrew Bailey, who remains unconvinced of the need for a retail CBDC. A decision to build would entail upfront costs in the hundreds of millions of pounds (later offset by CBDC income), voluntary participation by banks, and risk of political backlash over privacy concerns. [Bloomberg]
For a Political Economy of Central Bank Digital Currency (REP)
In this 2024 Revue d’Economie Politique (REP) article, Christian Pfister applies a positive (political economy) rather than normative framework to retail central bank digital currency (rCBDC). He maps stakeholder incentives across governments, central banks, regulators, incumbent banks, and fintech firms, then tests whether stated policy rationales align with those incentives. He concludes that publicly foregrounded motives, like financial inclusion, payment system safety, monetary sovereignty, and privacy, are analytically weak or already reached in developed economies. The dominant but largely unstated drivers are fiscal, such as seigniorage maximization through balance-sheet expansion, permanent rollover of sovereign debt held as rCBDC backing, and reduced tax evasion. Setting rCBDC remuneration at zero, officially framed as “do no harm” to bank intermediation, simultaneously serves those seigniorage objectives while suppressing a monetary policy transmission channel that the academic literature broadly endorses. For institutional design, combining legal tender status with fee exemptions advantages rCBDC in ways that raise competitive-neutrality concerns and risk crowding out private innovation. In non-democratic settings, programmable money creates structural conditions for mass surveillance. [REP]
Why Java Card Is a Natural Foundation for Secure Digital Cash (G+D)
Lars Hupel (G+D) argues that Java Card, as the execution environment for secure elements, is a strong foundation for digital cash (including CBDCs) because it supports offline-capable, tamper-resistant wallets, integrates standardized cryptography and PKI for secure issuance and transfer, enforces wallet lifecycle policies and integrity, and keeps sensitive operations inside certified hardware to balance privacy with control, while its modular, standards-based design can adapt to future cryptographic and regulatory changes. [G+D]
Eastern Caribbean Central Bank Suspends DCash 2.0 Project (ECCB)
[February 13, 2026] The Monetary Council of the Eastern Caribbean Central Bank (ECCB) approved the suspension of the DCash 2.0 central bank digital currency (CBDC) project to prioritize the development of the fast payment system (FPS) and participation in the The Caribbean Community (CARICOM) Payments and Settlement System (CAPSS) pilot. [ECCB]
On April 22, 2026, the Peterson Institute for International Economics (PIIE) hosted a virtual event at which Nicolas Véron interviewed the European Central Bank's (ECB's) Piero Cipollone on the digital euro project. As Izabella Kaminska noted on X, at one point Veron opined that the ECB's concerns about the big US payment companies (e.g., MasterCard and VISA) pulling out of Europe is somewhat far-fetched, to which Cipollone admitted that the rhetoric is largely in play just to motivate legislators to push ahead with the digital euro. "The geopolitical risk, this is resonating much more with politicians and that's where we saw some acceleration from the political side to put this project into focus... I must confess that before, this was a slow-moving project, at least at the legislative level. Then what happened in the last three/four years, it provided a sort of acceleration, mostly on the political side". [PIIE] https://x.com/izakaminska/status/2046942778437829085
