Federal Reserve Governor Christopher Waller said on May 31, 2026, in Dubrovnik, Croatia, that stablecoins could broaden the reach of US monetary policy worldwide by functioning like a fixed exchange rate system for adopting countries [1, 2, 3]. He explained, "Countries that adopt it, it’s like a fixed exchange rate system. You are going to import US monetary costs, so it’s broadening the reach of US monetary policy in countries that use more stablecoins" [1]. He added in Chinese that stablecoins "are only a payment tool; they are not evil or dangerous. They just bring competition to the payment world" [4].

Nearly 99% of stablecoins’ market capitalization is backed by US dollar assets, amplifying this effect [3]. Waller noted, "The more frequently a country uses stablecoins, the greater the extension of US monetary policy’s reach" [3]. He also expressed skepticism about the prospects of central bank digital currencies, saying enthusiasm among some central banks has waned [4].

The wider adoption of stablecoins could weaken other countries’ monetary sovereignty by limiting their control over interest rates, exchange rates, and capital flows [2]. Megan Greene, a Bank of England policymaker, predicted stablecoins might disappear within five years, replaced by tokenized deposits, saying, "I think tokenized deposits may replace stablecoins, and in five years, we might wonder why we ever talked about stablecoins" [4].

On US regulatory efforts, the Senate Banking Committee approved the 2025 Digital Asset Market Clarity Act in mid-May 2026 to clarify authority over virtual assets and allow interest on stablecoins [4, 3]. The act, passed by the Senate Banking, Housing, and Urban Affairs Committee on May 15, 2026, will proceed to the full Senate [4]. Senator Cynthia Lummis warned failure to pass the bill risks ceding crypto leadership to countries like China, saying the US "built the dollar-dominated financial system that has been the bedrock of global stability for a century" and "now is the time to act before Beijing decides otherwise" [4].

Separately on May 31, 2026, the US Commerce Department issued new export controls banning Nvidia and AMD from selling advanced AI chips to Chinese companies outside mainland China, closing a regulatory gap [2, 3]. The ban covers Nvidia Rubin and Blackwell GPUs and AMD MI350x chips and imposes licensing requirements for advanced chip exports to Chinese entities regardless of location [2, 3].