Bank for International Settlements (BIS) researchers released a report saying that USD stablecoins are creating a new form of “digitally dollarized” activity, and that this phenomenon is largely not constrained by traditional capital controls. The study compared data from more than 130 economies and found that while both stablecoins and traditional foreign-exchange deposits tend to increase during periods of macroeconomic stress, traditional bank deposits are clearly affected by capital controls. Stablecoins, however, show little response to capital controls and foreign-exchange restrictions because some of them circulate at the regulatory margins. BIS warned that this could weaken currency sovereignty in emerging markets by bypassing the traditional banking system. (Cointelegraph)