Dan Katz, First Deputy Managing Director of the International Monetary Fund, warned that domestic stablecoins designed to reduce reliance on dollar-pegged stablecoins could ironically make it easier for users to switch to digital dollars. Once both types of stablecoins operate on the same blockchain infrastructure, users could easily convert between them via decentralized exchanges, liquidity pools, or peer-to-peer swaps. This could accelerate the shift of foreign exchange activity from banks to on-chain venues, weakening authorities' ability to monitor capital flows.

The International Monetary Fund said local-currency stablecoins may end up helping the spread of U.S. dollar-pegged stablecoins when both circulate on the same blockchain infrastructure. Dan Katz, the IMF’s first deputy managing director, said users in that setup can move between local-currency and dollar stablecoins through decentralized exchanges, liquidity pools, or peer-to-peer transfers. He said that convenience could support broader use of dollar stablecoins rather than contain it. Katz added that users may prefer dollar stablecoins because of their liquidity, network effects, and wider acceptance across platforms and across borders. He also pointed to South Africa as an example, saying adoption of dollar stablecoins there remains limited, while demand for rand-linked stablecoins is even lower. Katz urged regulators to bring fiat on- and off-ramps, along with on-chain transaction venues, into their regulatory frameworks.

JPMorgan strategists said the US Treasury’s readily available resources for foreign-exchange intervention are limited, but the pool could expand sharply under less conventional funding arrangements. In an Aug. 3 note, the bank said the Treasury’s Exchange Stabilization Fund held roughly €13 billion in euro-denominated assets and $25.5 billion in dollar assets as of June. That amount looks modest next to Japan’s intervention size of about $35 billion to $60 billion between 2022 and 2026. The report laid out two ways to increase intervention capacity: converting the Treasury’s IMF Special Drawing Rights into dollars, and swapping foreign-currency assets into dollars. Under that framework, JPMorgan said the Treasury could theoretically mobilize as much as $187 billion. If the Federal Reserve were involved, the scale of intervention could be "effectively doubled," implying a potential US-Japan pool of $374 billion. The strategists also warned that intervention capacity is not unlimited because the Exchange Stabilization Fund is finite and fresh funding may require congressional appropriations. The report came after the US Treasury, through the Federal Reserve Bank of New York and via Goldman Sachs and JPMorgan, bought yen last Friday in what it described as the first coordinated intervention with Tokyo in more than a decade.

Five years after El Salvador made Bitcoin legal tender, central bank data shows crypto remittances remain a tiny part of the country’s cross-border money flows. In the first half of 2026, crypto transfers reached $35.4 million, equal to just 0.7% of the $5.06 billion in total remittances, even after rising 39.1% from a year earlier. More than 84% of remittance inflows still moved through banks and traditional money transfer firms, while cash remittances accounted for 3.8% and were five times larger than crypto channels. The report argues that user habits, trust in established providers, and policy changes have all limited broader adoption. After securing a $1.4 billion IMF loan in February 2025, El Salvador revised its Bitcoin Law, made Bitcoin acceptance optional for private merchants, required taxes to be paid in U.S. dollars, and began winding down the state-backed Chivo wallet. The analysis also raises the possibility that stablecoins, not Bitcoin, may be driving much of the recent growth in crypto remittances, though no detailed breakdown was provided.

The International Monetary Fund said in its Financial System Stability Assessment released this month that Brazil’s crypto-based cross-border flows have been rising steadily since 2017 and now exceed traditional capital flows. According to the report, most of those flows are driven by stablecoins, with companies and retail users turning to them for efficiency and tax-related reasons. The IMF said stablecoin activity is correlated with international and domestic investment indicators including the S&P 500, the VIX, and Bitcoin prices, while also being affected by exchange rates, interest rates, policy uncertainty, and changes in tax policy. The report added that Brazil’s central bank has already taken steps to regulate the virtual asset service provider, or VASP, sector, but gaps remain in areas such as legal protections for customers and segregation of custodied assets. On anti-money laundering and counter-terrorist financing, the IMF said international standards including the travel rule still need to be fully implemented. It also noted links between Brazil’s crypto system and the traditional financial system, and said regulators need stronger cooperation at home and abroad as well as better reporting mechanisms. Brazil’s Congress is preparing to review Bill 4308/2024 to define the status of stablecoins.

El Salvador’s two main opposition parties have formally named their candidates for the February 2027 presidential election, and both are running against President Nayib Bukele’s Bitcoin strategy. The Nationalist Republican Alliance (ARENA) selected former lawmaker Maytee Iraheta, while the Farabundo Marti National Liberation Front (FMLN) nominated physician and union leader Rafael Aguirre. Both candidates described Bukele’s Bitcoin approach as a fiscal failure. Bukele, whose approval rating currently stands at 94%, has already secured the nomination of his New Ideas party. The political divide comes after El Salvador rolled back one of Bukele’s signature crypto policies. In February 2025, after reaching a $1.4 billion loan agreement with the International Monetary Fund, the country removed Bitcoin’s status as legal tender, restoring the US dollar as the only official currency. Even so, the government has continued buying roughly 1 BTC per day. As of July 27, El Salvador’s holdings stood at about 7,730 BTC, keeping Bitcoin on the political agenda ahead of the 2027 race.

Central bank data from El Salvador shows the country received more than $5 billion in remittances in the first half of 2026, but only $35.4 million was settled through cryptocurrency channels, equal to about 0.7% of the total. The figure was up 39.1% from $25.4 million a year earlier, yet crypto remains a minor payment rail in the remittance market. Banks and traditional money transfer companies still control more than 84% of the market. The data adds fresh context to El Salvador’s bitcoin policy after the country made BTC legal tender in 2021 and promoted tools such as the state-backed Chivo Wallet to cut cross-border transfer costs. Even so, actual adoption in remittance use cases has stayed limited. Chivo is also being gradually wound down under the terms of the government’s credit agreement with the International Monetary Fund, or IMF.

JPMorgan has filed with the SEC for JLTXX, a second tokenized money market fund on Ethereum, with a 0.16% fee and $1M minimum. It targets stablecoin issuers' reserve management needs. Analyst says fee is significant.