TLDR

• Fed Governor Stephen Miran called stablecoins "a force to be reckoned with" during his first public comments on crypto.
• He warned that widespread stablecoin adoption could put "downward pressure on interest rates."
• Miran said innovation in crypto is already producing "economic consequences" relevant to monetary policy.
• His comments arrive as the Fed debates rate cuts and the U.S. accelerates stablecoin regulation through the GENIUS Act.
• Miran expects rate cuts in December, per Reuters.

Federal Reserve Governor Stephen Miran offered his clearest view yet on crypto and stablecoins on Friday, calling them an "area of enormous growth" and warning that their widespread adoption could reshape monetary policy-possibly even lowering interest rates over time. His remarks came during the BCVC Summit in New York City, marking the first time he has publicly addressed digital assets since joining the Fed in September. 

For a central banker who typically focuses on macro fundamentals, Miran's decision to spotlight stablecoins is notable. It reflects the growing reality that crypto-native financial instruments are no longer on the fringes of economic debate-they are starting to influence capital flows, liquidity, and the broader U.S. financial architecture.

Miran Breaks His Silence on Crypto

Miran was asked directly about cryptocurrency during a panel session, and although he did not commit to a firm view on the broader sector, his assessment of stablecoins was unambiguous.

His comments underscored that even within the Federal Reserve-an institution known for caution and deliberate pacing-stablecoins have emerged as a material part of the U.S. economic conversation. That shift follows a year of intense stablecoin activity in Washington, including the passage of the U.S. GENIUS Act in July, the country's first regulatory framework for fiat-backed tokens. While Miran was less certain about crypto beyond stablecoins, he acknowledged that real innovation is happening across the sector.

For a governor who stepped into his role only months ago, the message was clear: crypto is no longer theoretical. It is already intersecting with the Federal Reserve's core responsibilities.

Stablecoins and Interest Rates: A Surprising Connection

Miran's most consequential remarks came during his prepared speech earlier in the day, where he outlined a scenario in which stablecoin adoption directly influences interest rates. It's a topic rarely discussed publicly by Fed officials.

On stage, he said that the widespread use of stablecoins could put "downward pressure on interest rates." He went on to explain the mechanism:

This is a striking assertion coming from a member of the Federal Reserve. The neutral rate (often called r-star) is one of the most influential variables in modern central banking. A lower r* essentially means the Fed must lean toward more accommodative policy to support growth.

Miran's argument highlights a concept that crypto economists have debated for years: stablecoins are not just payment tools; they also reshape liquidity dynamics. When stablecoin issuers hold large reserves of short-term U.S. securities or cash equivalents, they effectively increase demand for Treasuries and deepen the pool of loanable funds, nudging interest rates downward. For the Fed, that introduces a new variable-one that policymakers cannot ignore as stablecoin circulation surpasses hundreds of billions globally.

A Critical Moment for U.S. Monetary Policy

Miran stepped into his role during a tense period for the Federal Reserve. The institution is navigating the aftermath of high inflation, a volatile rate environment, and political pressure from the White House. Former President Donald Trump has pushed for steeper and faster cuts, an approach that Fed Chair Jerome Powell and several other governors have resisted.

But Miran has publicly aligned with the view that rates should come down sooner. According to reporting from Reuters, Miran said on Thursday that he expects rate cuts in December.  His stablecoin comments add a new dimension to the debate. If digital dollars circulating outside the traditional banking system create downward pressure on interest rates, it could strengthen arguments for lowering policy rates earlier than planned-or at least force policymakers to reevaluate their models.

A New Tone From Within the Federal Reserve

Miran's comments stand out because the Federal Reserve typically treats crypto with cautious neutrality. Past remarks from Fed Chair Jerome Powell emphasized potential risks, not benefits. Other governors have flagged concerns about stablecoin runs, liquidity mismatches, and regulatory gaps.

Miran, however, framed stablecoins differently-as a powerful, growing force that requires recognition rather than dismissal. That shift mirrors broader geopolitical trends. Around the world:

• The U.S. has embraced regulated stablecoins through bipartisan legislation.
• The EU is pushing forward with the digital euro.
• Hong Kong is expanding tokenization pilots.
• Japan is launching legally recognized fiat-backed stablecoins.
• Latin America is using stablecoins to solve inflation and remittance inefficiencies.

Stablecoins are becoming embedded in global economic infrastructure, and U.S. regulators can no longer ignore their potential influence.

Final Thought

Stephen Miran's comments mark a turning point in how the Federal Reserve talks about stablecoins. By framing them as a "force to be reckoned with" and acknowledging their potential to influence interest rates, he placed digital assets squarely inside the macroeconomic conversation. Stablecoins are no longer just technological experiments-they are shaping liquidity, shifting market behavior, and forcing central banks to confront a future where monetary tools must adapt to decentralized financial infrastructure. As the U.S. prepares for rate decisions and new regulatory frameworks, Miran's remarks will likely shape both policy debates and market expectations in the months ahead.