Scott James

Cryptomercantilism vs. Monetary Sovereignty-Dealing with the Challenge of US Stablecoins for the EU | Think Tank | European Parliament Cryptomercantilism vs. Monetary Sovereignty-Dealing with the Challenge of US Stablecoins for the EU

This is very good
www.europarl.europa.eu/thinktank/en...

I’m surprised that the prospect of UK payments being squeezed between dollar stablecoins and a retail digital euro hasn’t triggered bigger questions about monetary policy, financial stability and 😱 the future of the £

Unusual for the UK to find itself increasingly at odds, in tone at least, with both the US and EU on digital currencies
www.bankofengland.co.uk/speech/2025/...

Commission livid as ECB warns of crypto apocalypse under Trump Washington’s embrace of crypto may endanger the European financial system, but Frankfurt and Brussels are arguing over whether to rewrite a landmark law.

And now at the EU level
www.politico.eu/article/euro...

Rachel Reeves and Andrew Bailey clash over Revolut meeting Chancellor’s aim to discuss fintech becoming fully fledged bank thwarted by BoE governor

We’re seeing how digital finance has significant potential to disrupt the established epistemic politics of post GFC monetary and financial governance

Innovate Finance: UK must act now to lead the global stablecoin economy - Innovate Finance – The Voice of UK FinTech New framework sets out path to make Britain the global centre for stablecoin innovation, growth and regulation London, 29th April 2025 – Innovate Finance,

And we’re even further from 1955, aka the digital eurodollar market 🚀
www.innovatefinance.com/blogs/innova...

🚨This is not 1986, but there are divergent voices within the Bank

Andrew Bailey cautions banks against issuing their own stablecoins Bailey said the moves by banks to launch their own stablecoins could threaten financial stability and the nature of money.

There will be a lot of talk about City deregulation later, but history tells us that serious policy change requires the alignment of the City-BOE-Treasury nexus, which is less clear at this moment…

Commission livid as ECB warns of crypto apocalypse under Trump Washington’s embrace of crypto may endanger the European financial system, but Frankfurt and Brussels are arguing over whether to rewrite a landmark law.

Intra-EU conflict over stablecoin regulation likely to be particularly protracted as it reflects the emergent epistemic - even ontological - geopolitics of crypto

Pension funds 💔 gilts For whom the bell tolls

A reminder that recent gilt volatility may have more to do with structural factors and liquidity constraints in long-dated gilt markets than questions around the government’s fiscal credibility

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High beta Britain in a uniquely difficult position. If investors lose faith in a government with a huge majority it’s unclear where the electoral resolution comes from.

I think the problem is less quantum of demand for Gilts and more natural habitat question - pension funds were reliable buyers of long-dated bonds. And the DMO will have structured issuance around market demand. Likely need to make big shifts to future supply across the curve.

Going through the (depressing) OBR Fiscal Risks Report and, bloody hell, that’s quite the chart.

obr.uk/docs/dlm_upl...

Great point, which is itself a function of the electoral system. Telling if the most stable period of post GFC politics is the 5 years when we experimented with serious coalition politics

The big difference with Sept 22 being that while gilt markets hastened the departure of Kwarteng and Truss they may now save Reeves

6. Why did long gilts hate PMQs?

Possible answers:
a) Reeves seen as a fiscal hawk within Labour; PMQs raises chance of a new deficit-loving ChX;
b) Govt seen as likely to collapse, and have you seen Reform UK's plans?
c) UK revealed as fundamentally unserious country

Have spent insufficient time on gilt mkt today. Very quick thoughts.

1. Sell-off at the long-end properly nasty.

Non-bond-types wondering whether to trust reports of 'bond mkt rout'? Rout is fair. PMQs look central to this.

Stablecoins: Reinventing the 19th-Century Banknote A true innovation for anyone who needs to do crime or evade taxes

Why we need an e̷p̷i̷s̷t̷e̷m̷i̷c̷ ontological politics of stablecoins

Day 2, PAIS research conference: IPE of private equity, fintech and sovereign creditworthiness

Chris Clarke on meme finance and Mat Watson on macro modelling

Great to host this workshop on Epistemic Politics with @benclift.bsky.social at Warwick yesterday

But arguably shadow money for shadow banks:
www.tandfonline.com/doi/full/10....

🙃

🥹

Stablecoins backed by physical gold in Swiss vaults is the plot twist we’ve been waiting for

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Call for papers for the 2025 IPEG workshop on 12 September @SussexUni ends on Monday so don't miss out!

🌎'International Political Economy in a world on fire'🌎

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Delighted that Lucia Quaglia was able to present our recent work on Bigtech finance at the BIS

I enjoyed his recent paper on the single euro payments area

Like post Brexit sterling, maybe the dollar’s fate is not linear decline but increasing oscillation between safe haven and high beta behaviour