The New York Fed president said he is less concerned about stablecoin risks, while noting the tokens are used more for payments than as a store of value and do not threaten bank deposits.
John C. Williams, the president of the Federal Reserve Bank of New York, said he is less worried about risks from stablecoins, signaling a more comfortable stance as the U.S. regulatory framework has developed. Williams has said stablecoins are used more for payments than as a store of value and do not pose a threat to bank deposits. His latest comments come after the GENIUS Act was signed into law in July 2025, creating what the article describes as the first comprehensive federal framework for payment stablecoins in the United States. The law requires 1:1 backing with cash and short-term instruments, non-interest-bearing reserves and tailored risk management by issuers. The article said stablecoin market capitalization grew about 50% during 2025 amid higher transaction volumes and deeper use in decentralized finance, though views inside the Fed are not uniform. Governor Michael Barr has raised concerns about reserve quality, liquidity risks and the potential for runs, while the 2022 collapse of TerraUSD remains a warning about how quickly confidence can break down. The immediate market reaction to Williams' remarks was muted.