RBI Deputy Governor: Stablecoins Will Increase the Risk of Dollarization

According to ChainCatcher, the Deputy Governor of the Reserve Bank of India stated in a public speech that stablecoins may exacerbate the risk of dollarization of local currencies, weaken emerging economies' ability to regulate capital flows, and pose a threat to the independence of monetary policy. In addition, their circulation may also increase credit costs and trigger currency substitution effects. Foreign stablecoins could lead to the loss of seigniorage revenue for many countries.