Fintech
At this year’s Sibos conference, Federal Reserve Gov. Christopher Waller surprised participants with strong support of Stubcoin as a driver of the payment system’s competition.
Rather than treating them as novelty, Waller positioned tokens as part of America’s longstanding culture of financial innovation. This is a “new form of private money” that can thrive alongside banks, card networks and fintech platforms.
Waller Discussed That consumer choice has always been on payment progress, from the expanding credit cards decades ago to the recent rise of mobile wallets. He said the stubcoins should be seen in the same light. Their presence could pressure existing people to lower fees and upgrade their user experience, especially in areas such as cross-border transfers where costs remain stubbornly high, he added.
Spotlight crossing border costs
The remittance corridor is one of the most expensive transactions in finance and is under pressure by a layer of intermediaries. Waller suggested that blockchain-based assets can reduce their complexity and provide increased payment speeds and efficiency that traditional players struggle to match. For individuals, this means faster and cheaper payments. For businesses, improved liquidity management.
Fed research is practical
Beyond Stablecoins, Waller revealed that the Fed is directly testing tokenization models, smart contracts and artificial intelligence in payment systems. He said the goal is to learn from private sector innovations while identifying potential upgrades to the Fed’s own infrastructure. This illustrates the transition from observation to experimentation, reflecting the growing awareness of central banks about how quickly the financial landscape is changing.
Guardrails remain unnegotiable
Despite optimism, Waller emphasized that trust is built on regulation. Without general standards, digital platforms warned that there was a risk of exposing consumers to cyberattacks and creating systematic vulnerabilities. He argued that recruitment should be combined with redundancy, safeguards and clear surveillance to ensure the resilience of the global payment system.
By threading innovation with caution, Waller cast Stubcoin as both an opportunity and a challenge. It is a tool that can modernize payments and remittances, but only if you accept the same severity as traditional financial infrastructure.
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