Federal Reserve Board Governor Christopher J. Waller delivered a Sibos 2025 speech on how emerging technologies such as stablecoins, distributed ledger technology (DLT), tokenization, smart contracts and artificial intelligence (AI) could make payments faster, cheaper and more efficient, while emphasizing the need for guardrails to protect consumers and the financial system. Waller framed stablecoins as a new form of private money that could coexist with cash and bank deposits, and argued that their scaling depends on users viewing them as safe, low-risk assets with regulatory protections. He cited frameworks such as the GENIUS Act in the United States, under which payment stablecoins would be backed at least 1 to 1 with safe, liquid assets and redeemable at par. On cross-border payments, he pointed to potential DLT-enabled models including “stablecoin sandwich” conversions and tokenized deposits, while noting that some frictions are purposeful for compliance and risk-management objectives such as anti-money laundering and countering the financing of terrorism. The speech also highlighted AI applications in payments, including automating manual tasks, detecting fraud and compliance risks, and using AI agents to execute tasks, alongside cybersecurity and resilience challenges as activity shifts to new digital rails. He said the Federal Reserve can support private-sector innovation by convening stakeholders, providing regulatory clarity within its remit, operating core payment and settlement infrastructure, and conducting hands-on research on tokenization, smart contracts and AI. Waller added that he plans to convene industry leaders and U.S. policymakers in three weeks to discuss further improvements to the payment system.

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