At the 32nd Dubrovnik Economics Conference, Federal Reserve Governor Christopher Waller and Bank of England policymaker Megan Greene offered sharply contrasting visions for the future of digital money — sparking a debate that cuts to the heart of how global payments will evolve over the next decade.
What Happened
During a panel titled "Stablecoins and Monetary Policy" in Dubrovnik, two of the world's most influential central bank voices faced off. Waller is a Fed Governor; Greene is an external member of the Bank of England's Monetary Policy Committee. Both agreed the payments landscape is shifting rapidly — but that is where the agreement ended.
The Fed: Stablecoins Are Useful and Not Dangerous
Waller took a measured, broadly supportive stance. He characterized stablecoins as payment instruments that increase competition in the payments system and said he saw "nothing inherently dangerous" about them. His main concern was geopolitical: countries that become overly dependent on dollar-backed stablecoins risk importing U.S. interest-rate conditions and liquidity pressures.
Bank of England: Stablecoins Will Be Gone in Five Years
Greene was far more skeptical. She predicted that tokenized deposits — digital tokens representing commercial bank liabilities — will likely supplant privately issued stablecoins.
"I think tokenized deposits are probably going to take over from stablecoins, and five years from now I suspect we might wonder why we were talking about stablecoins," she said. Greene offered a memorable metaphor: central bank digital currencies are the tortoise, stablecoins are the hare, and tokenized deposits are the rhinoceros. She also warned that if stablecoins drain funds from commercial banks, central banks could lose their grip on monetary policy effectiveness.
Why This Debate Matters Now
The clash comes amid intense legislative battles in the U.S. Congress, where the Digital Asset Market Clarity Act is working its way through committee. The Bank of England itself recently softened its own "overly conservative" stablecoin proposals under industry pressure. The question of whether private stablecoins or bank-issued tokens win is worth trillions of dollars in global payment flows.
What Comes Next
The world's major central banks are quietly splitting into two camps: the Fed sees stablecoins as a pragmatic evolution in payments; the Bank of England sees them as a transitional phase before bank-centric digital money takes over. How regulatory frameworks develop in the U.S. and Europe over the next two to three years — and how quickly banks can deliver competitive tokenized products — will likely decide the argument.
