A sitting member of the Bank of England's rate-setting committee told a conference audience that the stablecoin boom may be a passing phase. Speaking in Dubrovnik, Croatia on May 31, 2026, Monetary Policy Committee member Megan Greene predicted that tokenized bank deposits will eventually displace stablecoins as the dominant form of digital money, according to comments first flagged by Cointelegraph and reported by Reuters.
Her line was blunt: "I think tokenised deposits are probably going to take over from stablecoins and five years from now, I suspect we might wonder why we were talking about stablecoins." Coming from a central banker who helps set UK interest rates, that is a sharper public bet against stablecoins than most regulators have been willing to make.
The tortoise, the hare, and the rhino
Greene sorted the three competing forms of digital money into a racing metaphor. The tortoise is the central bank digital currency, slow and deliberate. The hare is the stablecoin, fast out of the gate. The rhino is the tokenized bank deposit, heavy and late but built to win. "We'll probably end up with all three," she said, "but if I had to put money in one, it would be the rhino, tokenised deposits, which I think will probably take off."
Tokenized deposits are digital representations of ordinary commercial bank balances, recorded on a shared or distributed ledger so they can move with the speed of a stablecoin while staying inside the regulated banking system. Unlike a stablecoin used for everyday spending, which is a claim on a private issuer's reserves, a tokenized deposit remains a claim on a licensed bank and stays covered by the same deposit and supervisory framework.
The reason banks held back
Greene argued that the technology has not stalled for technical reasons. Commercial banks have simply preferred the status quo. "Digital deposits haven't taken off because commercial banks don't want to lose the fees," she said. "But they're going to lose them anyhow."
That is the core of her thesis. If customers move balances into stablecoins to get faster, programmable, around-the-clock payments, banks lose deposits regardless. Building tokenized deposits is the defensive move that lets a bank keep the customer relationship while matching what stablecoins offer at the checkout and in the back office. Once one large bank moves, the competitive pressure on the rest follows.
A contrarian read on a record year
The timing is pointed. Stablecoin supply has run to record levels in 2026, recently near $322 billion, and a growing share of crypto card transactions settles in USDC or USDT at the point of sale before converting to local currency. The narrative across most of the industry has been that stablecoins are entrenched and only getting bigger.
Greene is betting against the durability of that demand, not the demand itself. Her view is that today's stablecoin usage is partly a workaround for a banking system that has not yet shipped a competitive product, and that the workaround fades once banks do. It is a prediction, not a policy, and other officials disagree. The US Treasury under Scott Bessent has backed dollar stablecoins while rejecting a retail CBDC, and US payment networks have been wiring stablecoin settlement directly into their rails.
The Bank of England has taken a more cautious line than Washington. It has floated holding limits on systemic stablecoins for individuals and businesses, reflecting concern that large migrations of money out of banks and into stablecoins could weaken credit creation. Greene's comments fit that institutional posture: less hostility to digital money in general, more skepticism that the privately issued version is the one that lasts.
The stakes for payment products
For anyone building or using crypto payment products, the question is which rail consumer spending settles on a few years out. Cards that draw down stablecoin balances, programs that pay rewards in USDC, and merchants that accept on-chain settlement are all built on the assumption that stablecoins remain the default digital dollar. A shift toward tokenized deposits would not kill those products, but it would change the plumbing underneath them and the entities that control it.
For now, nothing changes at the till. Stablecoin spending in the United Kingdom and elsewhere works the same today as it did yesterday, and the holding-limit debate is still a consultation rather than law. The signal worth tracking is whether large commercial banks start shipping tokenized deposit products in response to the kind of pressure Greene described. If they do, her five-year clock starts ticking. If they keep protecting fee income instead, stablecoins keep the lane to themselves.
Overview
Bank of England policymaker Megan Greene said on May 31, 2026 that stablecoin demand will likely fade within five years as tokenized bank deposits take over, using a tortoise (CBDC), hare (stablecoin), and rhino (tokenized deposit) analogy to rank the contenders. Her thesis is that banks have delayed digital deposits to protect fees but will lose those fees regardless, forcing them to compete. The comments cut against a year of record stablecoin supply near $322 billion and contrast with the more stablecoin-friendly US stance. No rules changed; the development to watch is whether major banks start shipping tokenized deposit products.
