{"id":7204,"date":"2022-10-06T11:03:56","date_gmt":"2022-10-06T11:03:56","guid":{"rendered":"https:\/\/newmoneyreview.com\/?p=7204"},"modified":"2022-11-11T07:28:32","modified_gmt":"2022-11-11T07:28:32","slug":"why-stablecoins-disrupt-the-financial-plumbing","status":"publish","type":"post","link":"https:\/\/newmoneyreview.com\/index.php\/2022\/10\/06\/why-stablecoins-disrupt-the-financial-plumbing\/","title":{"rendered":"Why stablecoins disrupt the financial plumbing"},"content":{"rendered":"

Two events in the last fifteen years have fundamentally altered the way the financial system operates\u2014and neither was planned by global policymakers.<\/p>\n

The great crash of 2008 stopped banks from extending loans to counterparties without taking security in return. Henceforth, large credits would require collateral to be posted by the borrower.<\/p>\n

And cryptocurrencies have spawned a new form of digital money\u2014the stablecoin\u2014that threatens to torpedo central banks\u2019 control of the monetary system.<\/p>\n

One person who has kept a close eye on the role of collateral and stablecoins is Manmohan Singh, a senior economist at the IMF and my guest on the latest episode of the New Money Review<\/em> podcast<\/a>.<\/p>\n

\"\"<\/p>\n

Manmohan Singh<\/em><\/p>\n

Singh, whose specialist area is the plumbing that underlies our money markets, says getting the design of the system right is crucial to ensure adequate lending and continuing economic growth.<\/p>\n

And the stakes are getting higher as central banks unravel their quantitative easing programmes, while the digital money revolution picks up pace.<\/p>\n

Listen to the New Money Review<\/em> podcast<\/a> for more on:<\/p>\n