Kganyago issues warning on rising stablecoin risk

South African Reserve Bank (Sarb) Governor Lesetja Kganyago has warned about the risk of the increasing popularity of stablecoins, saying there is a danger the cryptocurrency assets could “break apart”.

Central banks need “to protect the oneness of money and the affordability of money to the public”, Kganyago said Saturday at the 2026 Warwick Economics Summit. “The truth of the matter is that these things could break apart,” he said, in reference to stablecoins.

Read: Sarb warns of crypto, stablecoin risks amid regulatory gaps

The use of stablecoins – digital tokens backed by assets such as US Treasuries to maintain parity with traditional currencies – has risen sharply in South Africa as a less volatile form of cryptocurrency.

The central bank warned in November that a lack of comprehensive regulations for the assets has emerged as a new risk to the country’s financial sector.

Also, increased global uncertainty has underlined the importance of the various financial models used by the central bank, Kganyago said.

“We have got a suite of models,” he said.

Given the imposition of US tariffs and other changes in the past year, “this became very, very important”.

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European Central Bank (ECB) President Christine Lagarde on 5 February said the ECB is considering opening up repo lines for central banks outside Europe, which Kganyago said “would be a welcome development”, Reuters reported, citing an interview on the sidelines of the summit.

Kganyago also said the country’s interest rate-cutting cycle still has some way to go, Reuters reported.

© 2026 Bloomberg

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