YANIS VAROUFAKIS
ATHENS – The Spring Meetings of the International Monetary Fund and the World Bank are usually placid, forgettable affairs. Not this year. Several central bankers returned home with a visceral sense of dread. The reason? The specter of the GENIUS Act – the stablecoin bill barreling toward passage by the US Congress hot on the heels of President Donald Trump’s March 6 executive order establishing a strategic cryptocurrency reserve.
Central bankers have hitherto seen cryptocurrencies as a nuisance that, thankfully, lacked the capacity to cause serious ruptures in the monetary systems under their care. But now they think that Trump’s team are counting on cryptocurrencies pegged to the dollar as part of their strategy to rejig the global monetary system (and make the boss and his family a fortune in the process).
What unsettled central bankers this spring was the policy’s implications: a deliberate, chaotic unraveling of the twentieth century’s monetary order, under which central banks reigned as the sole architects of money. While the GENIUS Act allows private stablecoins, another bill would bar the US Federal Reserve from issuing a central bank digital currency (CBDC), thereby anointing corporate-issued tokens as the new guardians of dollar hegemony.
This isn’t innovation; it’s a hostile takeover of the money supply. Lacking anything resembling serious regulation, stablecoins are neither stable nor merely an alternative dollar payment option. They are a Trojan horse for the privatization of money.
The European Central Bank sees the danger. If securities migrate to the blockchain, with bonds, stocks, and derivatives becoming tokenized, then settlement must follow. The ECB’s solution is a tokenized euro, ensuring public money remains the bedrock of finance. So far, the ECB has faced resistance to this plan from German and French private banks. Now, the ECB has another, bigger headache: the United States is racing in the opposite direction. By banning CBDCs and green-lighting stablecoins, Trump’s team are not just rejecting public digital money; they are outsourcing dollar supremacy to the darkest forces within Big Tech.
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