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Former IMF Official: Stablecoins May Intensify Dollar Dominance and Currency Risks for Small Countries

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Eswar S. Prasad, former IMF official and Cornell professor, highlights the potential risks of stablecoins in his article *The Stablecoin Paradox*. He argues that while stablecoins lower payment costs and boost cross-border efficiency, they may also reinforce U.S. dollar dominance and threaten the monetary sovereignty of smaller nations. Prasad points out that what is often seen as a decentralized system is, in fact, reliant on trust in issuing institutions. He warns that this structure could lead to centralization of financial power and monopolization by major players.
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