BlackRock’s take on stablecoins cuts through the usual noise: if a token can’t move cleanly through the banking system, it isn’t really functioning as money in the way markets need it to.
- “Singleness of money” is the core idea
- Bank acceptance matters, not just reserve backing
- Central-bank money anchors final settlement
- The GENIUS Act gives the U.S. a federal stablecoin framework
- Europe is pushing back with the digital euro debate
That was the gist of remarks attributed to Nikhil Sharma, BlackRock’s head of digital assets, during the European Blockchain Convention’s Day 1 media briefing. His point was not that stablecoins are useless. It was sharper than that. Stablecoins can be useful only if they stay interchangeable with bank deposits and central-bank money.
Sharma put the issue in old-school monetary terms: “singleness of money.” In plain English, that means a dollar should be treated as a dollar whether it sits in a bank account, moves as a payment stablecoin, or ends up as central-bank money at final settlement.
That sounds tidy. Real finance is messier.
A stablecoin may be backed by cash, Treasury bills, or other liquid reserves. That helps, but reserve backing alone does not guarantee that banks, payment systems, and settlement networks will treat the token like money at par. A token can look like cash on a screen and still hit friction the moment someone tries to use it inside regulated finance.
Sharma said users need to understand the claim, backing, access conditions, and recourse attached to any payment form. That is the unglamorous part of the whole business. Money is not just an asset, it is also a legal claim with rules around redemption and settlement.
“From an investor-optionality standpoint, having different forms of cash is a good thing. But from a recourse, economic exposure, and risk standpoint, singleness of money is an imperative.”
He also gave a concrete example. If someone pays with a dollar stablecoin, the recipient’s bank would need to recognize that asset and treat it as a normal deposit liability, in other words, a customer balance the bank now owes. That is the kind of plumbing stablecoins need if they are going to work as regulated settlement assets, not just as tradable crypto tokens.
That leads to the bigger point: the banking system has to accept the token before the token can behave like money in a broad, reliable way. Bank acceptance matters first. Interoperability comes next. Final settlement comes after that.
Sharma said the final settlement layer should sit with central banks, where obligations between regulated financial institutions are ultimately settled in central-bank money, the safest form of money in the system. He said that mechanism could be provided in a “potentially unintrusive way, ” though he did not spell out a technical blueprint.
That last part matters because tokenized finance is moving faster than the legacy cash rails beneath it. Tokenized deposits are bank deposits represented on a blockchain or similar ledger. Tokenized securities can trade around the clock. Traditional payment and settlement systems do not always do the same. That creates a mismatch, especially on weekends and holidays, when markets can keep moving while dollar funding and redemption channels are harder to access.
That is the boring but important problem underneath all the shiny talk: if the money side can’t move cleanly, the onchain side is only half-built.
The U.S. has already started putting formal rules around this market. The GENIUS Act was enacted in July 2025, creating a federal framework for payment stablecoins. Under that regime, only permitted issuers may issue payment stablecoins in the U.S., subject to reserve, disclosure, and regulatory requirements.
That is a meaningful shift. It pulls stablecoins further away from the old wild west model and closer to supervised financial infrastructure. Not perfect, not magical, but at least less stupid than pretending billions in digital dollars can run on vibes and a whitepaper.
Most large stablecoins still reference the U.S. dollar and hold reserves in cash, Treasury bills, or similar liquid assets. That helps explain why they became the dominant form of stablecoin in the first place. They are simple to understand, useful for trading, and easier to settle than many traditional cross-border payment methods.
But the dominance of dollar-backed tokens raises a less comfortable question: if private issuers provide the digital dollar rails, what happens to public money and monetary policy influence?
That question is especially loud in Europe. The source material points to remarks from Isabel Schnabel of the European Central Bank, who said euro-denominated stablecoins make up only a small share of the market. Her answer, at least in broad strokes, is the digital euro, a public payment option meant to counterbalance private dollar token dominance.
The timeline there should be treated carefully. The materials say a pilot is expected in 2027 and potential readiness for issuance is targeted for 2029. Those are targets, not guarantees. But the direction is clear enough: Europe does not want dollar-backed stablecoins becoming the default digital cash for everyone else’s payments.
That is not just a branding issue. It is a sovereignty issue. If dollar stablecoins dominate payment use cases in Europe, private dollar infrastructure gets stronger while euro payment rails risk falling behind. Public digital money becomes less of a future project and more of a defensive move.
Philipp Müller of the Swiss National Bank added a useful central-bank perspective. He said commercial banks could issue stablecoins if they chose to do so.
“That could be wholesale CBDC, it could still be fiat money. Only time will tell, ”
For readers less steeped in central-bank jargon, a wholesale CBDC is a central bank digital currency built for use by financial institutions, not retail users. Müller’s point is basically that there may be several paths forward: bank-issued tokenized cash, wholesale CBDC, or some mix of existing fiat money and new rails. The future is unlikely to be one clean monolith.
That layered model is probably the most realistic one on the table.
Private stablecoins can handle access and programmability. Tokenized deposits can provide bank-native settlement. Central-bank money can anchor the safest final layer. That is far more plausible than a fantasy where one token type replaces the entire financial system overnight.
ARK Invest’s Lorenzo Valente gave some rough scale to the discussion. He said the digital-asset market is about $3 trillion, stablecoins roughly $300 billion, and tokenized assets between $30 billion and $40 billion. Those are panel estimates, not sacred gospel, but they do show the size gap between today’s stablecoin market and the still-small tokenized asset segment.
That gap matters. Stablecoins are already large enough to influence payments, trading, and liquidity management. Tokenized assets are growing, but they still need a dependable cash leg. If that leg is weak, the whole system starts wobbling fast.
The deeper takeaway is that the next fight in digital finance is not really “crypto versus banks.” It is about who controls settlement standards, redemption rules, and interoperability. That is where the power sits. Whoever sets those rules gets to decide what counts as money, what counts as a claim, and what counts as a nicely dressed risk instrument pretending to be cash.
For those tracking the policy side, the tension is already spilling into broader debates around BlackRock Challenges GENIUS Act’s 20% Stablecoin Reserve, while the market structure angle keeps showing up in conversations like RWA Adoption: Hype or the Next Trillion Investment. And yes, the regulatory whiplash still matters, especially after the earlier U.S. Senate Rejects GENIUS Act: Crypto Regulation Stalls phase that left stablecoins in limbo before the framework finally landed.
The most important backdrop, though, is that these battles are not just American. Europe’s own monetary response is still being debated, and the implications of Stablecoins, the GENIUS Act and Europe's Monetary dilemma are exactly why public digital cash keeps getting dragged back into the conversation.
City of Central may sound like a civic branding exercise, but the broader point is the same: if digital money is going to matter, the public and private layers of finance will need to coordinate far more closely than they did in the early crypto casino years.
Key questions and takeaways
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What does “singleness of money” mean?
It means different forms of the same currency should be interchangeable at par and treated as equivalent in payments and settlement. A dollar stablecoin only works cleanly if banks and payment systems treat it like a dollar, not like a weird side bet. -
Why does BlackRock care about stablecoin interoperability?
Because stablecoins only function as regulated settlement assets if banks, payment systems, and settlement rails accept them. Without that, they may still be useful, but they do not operate like full money inside the financial system. -
Is reserve backing enough?
No. Cash and Treasury bill reserves help support redemption, but legal claim, access conditions, and final settlement matter just as much. A well-backed token can still be awkward if the system around it won’t recognize it. -
What does the GENIUS Act change in the U.S.?
It creates a federal framework for payment stablecoins, with permitted issuers subject to reserve, disclosure, and regulatory requirements. That pushes stablecoins toward supervised finance instead of the old anything-goes phase. -
Why is Europe focused on the digital euro?
Because euro-denominated stablecoins still make up only a small part of the market while dollar-backed tokens dominate. The digital euro is being positioned as a public response to that imbalance. -
Are tokenized markets ready to run without central-bank money?
Not yet for broad regulated use. Tokenized markets can trade continuously, but they still depend on reliable cash rails for redemption and final settlement.
Stablecoins are useful. Tokenized deposits may prove useful too. But none of this works just because the labels sound futuristic. Regulation, redemption, and settlement are the machinery that matters. Everything else is marketing gloss.
