Global Stablecoins: Monetary Policy Implementation Considerations from the U.S. Perspective

14 Pages Posted: 23 Apr 2021

See all articles by David Lowe

David Lowe

Independent

Matthew Malloy

Board of Governors of the Federal Reserve System

Date Written: March 1, 2021

Abstract

This note explores the potential effects of the widespread adoption of a global stablecoin (GSC) on key aggregate financial sector balance sheets in the United States. To do this, we map out cash flows of GSC transactions among financial sector entities using a stylized set of 't-accounts'. By analyzing these individual transactions, we infer aggregate and compositional effects on U.S. commercial banking sector and Federal Reserve balance sheets. Through this lens, we also consider how these balance sheet changes could affect monetary policy implementation, the demand for central bank reserves, and the market for U.S. dollar safe assets.

JEL Classification: E40, E50, G21

Suggested Citation

Lowe, David and Malloy, Matthew, Global Stablecoins: Monetary Policy Implementation Considerations from the U.S. Perspective (March 1, 2021). FEDS Working Paper No. 2021-20, Available at SSRN: https://ssrn.com/abstract=3877873 or http://dx.doi.org/10.17016/FEDS.2021.020

Matthew Malloy

Board of Governors of the Federal Reserve System

20th Street and Constitution Avenue NW
Washington, DC 20551
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
163
Abstract Views
508
Rank
393,968
PlumX Metrics