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Nick Fabian, a three-time USA Swimming Scholastic All-American, has announced his commitment to Boston College, joining their class of 2029. Currently a native of Estero, Florida, Fabian will head north this fall to begin life in the ACC.
I am beyond blessed and excited to announce that I will be continuing my athletic and academic career at Boston College. I am extremely thankful for all my teammates, coaches, and friends who have supported me on my journey. I would like to give special thanks to Coach Dara and Coach Bruno for providing me with this opportunity. Most importantly, thank you to my mom, dad, and sister for their endless, unwavering support. I can’t wait to see what the future holds. GO EAGLES!!🦅🦅
Fabian is graduating from Community School of Naples, and was a two-time finalist at the FHSAA Class 1A State Championships in November, finishing 7th in the 200 free (1:40.30) and 8th in the 500 free (4:37.75). He competed in the 200 backstroke (1:56.50) and 400 IM (4:07.35) a few weeks later at the Speedo East Winter Junior Championships. Fabian was then a top-eight finisher in the 200 free (1:56.39) and 400 free (4:07.91) at the Southern Zone Sectionals in February, hitting Futures cuts on both.
He does his club swimming for T2 Aquatics, where he extends up to the mile as well as the 400 IM and 200 fly. He set best times in the 1000 free (9:09.05) and 400 IM (3:58.40) in March at the Florida Senior Championships, where he also added Futures cuts in the 200 free (1:40.60) , 500 free (4:30.47) and mile (15:48.61). He finished fourth in the 1000 free and 8th in the 1650 there in Orlando.
SCY Best Times
200 Free: 1:40.30
500 Free: 4:28.44
1650 Free: 15:35.64
200 Backstroke: 1:52.63
200 Butterfly: 1:51.14
200 IM: 1:56.32
400 IM: 3:58.40
He is a versatile swimmer who will strengthen Boston College’s distance freestyle and IM groups. His 500 ranks him third on the team behind Finn Crawford and Ben Huffman for next year, while his mile time would rank second behind Huffman.
Boston College currently competes in the ACC conference, where the men finished 13th at the 2025 championships. While Fabian is not in scoring range yet for the Eagles, he could well find himself on the 800 free relay in years to come. The slowest split on that relay was 1:37.78, less than three seconds faster than his 200 free flat start time.
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Researchers at Massachusetts Institute of Technology (MIT) have developed a way to ‘supercharge’ vaccines to the extent that just a single dose can provide strong protection from HIV.
Vaccines typically comprise two key components: immunogens that trigger an immune response in the body, and adjuvants which boost your immune system’s response to the immunogens. The MIT team, which collaborated with the medicine-focused Scripps Research Institute, focused on the latter, and actually combined two adjuvants to elicit a significantly better immune response than a vaccine with just either of them.
In the team’s study, whose results appeared in a paper in Science Translational Medicine this week, mice that received the dual-adjuvant vaccine exhibited a much wider range of antibodies against an HIV antigen, compared to those who received a vaccine with only one of the adjuvants.
In this work, the researchers found that the dual-adjuvant vaccine boosted what’s called the B cell response by two to three times more than single-adjuvant formulations. These B cells produce antibodies that can recognize a pathogen the body has previously been exposed to, and that gives you a better chance of fighting off dangerous viruses.
Indeed, the new approach caused the dual-adjuvant vaccine to accumulate in the mice’s lymph nodes and stay there for a month, during which time their immune systems effectively built up plenty of antibodies against the HIV protein.
The vaccine antigen (pink) being concentrated in a germinal center (yellow) within B cell follicles (cyan), triggered by the researchers’ combination adjuvant vaccine
Image courtesy of the researchers
“What’s potentially powerful about this approach is that you can achieve long-term exposures based on a combination of adjuvants that are already reasonably well-understood, so it doesn’t require a different technology,” chemical engineering professor J. Christopher Love remarked. “It’s just combining features of these adjuvants to enable low-dose or potentially even single-dose treatments.”
According to the researchers, this approach could come in handy for formulating protein-based vaccines to protect against many more challenging viruses, including influenza and SARS-CoV-2 (which causes COVID-19).
Interestingly, this breakthrough comes just as the US Food and Drug Administration (FDA) approved Lenacapavir, a twice-yearly injection that’s described as a ‘near-perfect shield against HIV infection.’ Rolling it out might prove challenging, as major global health programs that would procure and distribute the drug in low-income countries, have been slashed or undermined.
For context, HIV has already claimed more than 42 million lives worldwide, and nearly as many people were estimated to be living with the condition by the end of 2023. Of those people, 65% are in Africa. And in 2023, it was estimated that 1.3 million were infected with HIV globally.
Measures to prevent infection, such as strong vaccines, will prove vital to fighting this disease in the years to come.
The Iraqi authorities said a wave of drones targeted several Iraqi military bases in the early hours of Tuesday, including the Taji base 12 miles north of Baghdad, hours after Iran launched missiles at a U.S. base in Qatar.
What did Israel accomplish in Iran after 11 days of incessant bombing? Prime Minister Benjamin Netanyahu claimed in his statement acknowledging the ceasefire that the Israeli goals have been achieved. Such an assertion seems problematic, to say the least.
At the start of the short-lived war, he declared two goals: “decapitating the nuclear programme” and “regime change”.
Was the nuclear programme decapitated? The answer is likely negative. It seems that Iran transported fissionable material out of the Fordow facility attacked by the United States. This stockpile is the most important part of the nuclear programme, so “decapitation” seems to have failed.
What damage, if any, did Israel inflict on the Iranian nuclear programme? That is also unclear. Israel managed to persuade the US to attack Iranian nuclear facilities using bunker-busting bombs, Massive Ordnance Penetrators (MOPs), but the US did little else to help the Israeli offensive. The extent of destruction would be hard to evaluate since Iran is unlikely to grant outside access.
Has Israel generated “regime change” in Iran? The brief answer is that it has very much achieved the opposite. Israel attempted to trigger an uprising against the regime by killing military leaders of Iran’s various security structures. This strategy is based on the firm Israeli belief that the best way to destabilise an enemy is through assassinations of senior leaders. This has never worked. The only possible exception was the effect Hassan Nasrallah’s death had on Hezbollah in Lebanon, but that had a great deal to do with internal Lebanese political dynamics. In all other cases, Israeli assassinations have failed to create any major political change.
In the case of Iran, the assassinations rallied the people around the government. Israel assassinated the senior commanders of the Iranian Revolutionary Guard Corps (IRGC), perhaps the most powerful element in current Iranian politics, but also one of the most hated by the Iranian public. Regardless, many Iranians who consider themselves staunch opponents of the Islamic Republic and especially of the IRGC found themselves supporting it. Iranians saw Iran in its entirety under attack and not just “the regime”.
Israel’s attempts to bomb “regime symbols” only made the situation worse. It attempted to spin its air strikes on Evin Prison, infamous for the torture of political prisoners, as a contribution to the struggle of the Iranian people against the repression of the Islamic Republic. But Israel’s bombs effectively worsened the situation of the prisoners, as the authorities moved many of them to unknown locations.
Bombing the “Israel doomsday clock”, which Israelis often employ as a demonstration of Iran’s commitment to Israel’s destruction, was simply pathetic.
Israel’s bombing of the Iranian state broadcaster IRIB was also absurd. Israel claimed it was curtailing the regime’s attempt to spread propaganda. As many Israelis pointed out, this bombing gave the Iranians the vindication they needed to threaten Israeli television stations as well.
If Israel did not manage to achieve its stated war goals, did it at least manage to rally the world behind it, to make the public forget about Gaza and recast Israel again as fighting the good fight? That seems dubitable at best. True, President Donald Trump and the US did strike Iranian nuclear facilities. By doing so, they violated several major rules of international law. This is likely to have long-term implications. However, Trump did not join the war alongside Israel. Immediately after the strike, the strategic bombers returned to the US.
Before and after carrying out the bombing, Trump iterated and reiterated his desire for a deal between the US and Iran, one that may also include Israel. It seems likely that the US president assisted Israel to serve his own interests as well as those of his allies in the Gulf.
While several world leaders, most notably German Chancellor Friedrich Merz, were quick to support the US strikes and “Israel’s right to defend itself”, no one adopted Israel’s stringent list of demands, which included that Iran should not be able to enrich uranium at all.
The world returned to the formula of “no nuclear weapon”, with which Iran had already announced it was willing to comply.
When it comes to the operational development of the Middle East, the world appears to find Iran a legitimate partner for doing business. This is a loss for Israel and a victory for Iran.
The very real damage to the Israeli heartland should also be considered. Israel achieved aerial dominance over Iran very quickly and struck almost at will. Iranian missiles, however, repeatedly managed to penetrate the famed Israeli air defence system, strike at the heart of Israel and across the entire country, and bring it to a standstill while inflicting an unprecedented number of casualties as well as massive destruction. Israel was running low on interceptor missiles without hopes of immediate replenishment. The Israeli economy was quickly grinding to a halt. This was another triumph for Iran.
Iran emerged from the war bruised and bombed, suffering hundreds of casualties and real damage from incessant bombing around the country. But the Islamic Republic did not crumble, even when facing a massive Israeli force.
Iranian missiles hit home, Iran’s image was not tarnished (it was seen by most of the world as a victim of an Israeli attack), and Iran’s options for response were not severely constrained. Iran successfully de-escalated by warning in advance about its “retaliation” for the US strike on its military base in Qatar.
Iran was powerful enough to convince Trump to warn Israel not to attack after the ceasefire appeared to have been violated. Iran emerged as it prefers to emerge – still standing, and with potential for the future.
The views expressed in this article are the author’s own and do not necessarily reflect Al Jazeera’s editorial stance.
No matter the challenge, America always rises to the occasion. From the first successful airplane flight to landing a man on the moon, nothing can stop American grit and ingenuity. It is what makes our country great.
Today, we face new challenges: winning the global AI race and fueling an American manufacturing renaissance.
Doing so requires an enormous amount of electricity—much more than America can generate today. It’s an undertaking that will take Herculean efforts of infrastructure building unlike anything we’ve seen since the end of World War II.
To maintain American dominance on a global stage, the U.S. 450 gigawatts of generation over the next five years—to put that in perspective, that’s the equivalent of adding enough generation to power 75 Miami metro areas or 11 Floridas. For context, just over 40 gigawatts of new natural gas and nuclear has been built over the last five years in the U.S.
Now is not the time to take options off the table. The stakes are too high. Finishing second in artificial intelligence cannot be an option. Nor should squandering an opportunity to create American jobs.
Clean energy tax credits
It’s why the debate over clean energy tax credits cannot be just about renewable energy. It’s much more than that. It’s about whether we want to turn our backs on the only forms of power generation available at scale at a time when the U.S. needs every electron it can get.
I say this not as an ideologue, but as the CEO of the country’s largest electric provider and America’s quintessential all-forms-of-energy company.
NextEra Energy is not just a leader in home-grown renewables. We own and operate more natural gas power plants than anyone in America. We also operate one of the nation’s largest nuclear fleets. We own pipelines and a natural gas extraction business. Our sole abiding interest is delivering low-cost energy to our customers as quickly as possible.
It’s clear Congress —we’re not here to debate that. But for the sake of America’s power supply, economy, and national security, we urge lawmakers to take a measured approach.
Because new nuclear power plants are not available until the mid-2030s and traditional power plants take years to build and turbines , a full-stop, immediate elimination of credits or a change to start of construction would effectively shut off America’s supply of new power plants through the end of the decade.
Until then, America’s only option is to build wind, solar, and battery storage—which can serve as a bridge while we expand traditional power plant supply chains and workforces.
Lower energy costs
Last week’s Senate Finance Committee acknowledges this reality and offers a pragmatic approach to phasing out the clean energy credits, recognizing that businesses signed contracts and made enormous capital decisions based on current law. By some estimates, over $1 trillion of U.S. energy infrastructure investments could be put at risk.
Practical, commonsense provisions, like tying credits to the start of construction as they are phased out, provide a runway to finish projects and put much-needed electrons onto the grid while keeping power prices low for American homes and businesses.
Remember, energy companies do not get the credits—they flow directly to American homeowners and business owners through lower energy costs. And in rural communities across America, renewable and storage projects inject significant tax revenue often used for essential services like police, schools, and roads.
Investing in American infrastructure and putting our country first should not divide us. We should be united about what’s at stake, compromise in deference to the facts, and work together to build what America needs.
We have a golden opportunity to meet this uniquely American moment. Let’s come together and get this right for America.
John Ketchum is the chairman and CEO of NextEra Energy, one of the largest electric power and energy infrastructure companies in North America.
The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.
Security is tight at the Nato summit – President Trump’s first since 2019
German Chancellor Friedrich Merz has warned that Russia’s president understands only the language of force and that Tuesday’s “historic” Nato summit in The Hague will aim to ensure peace in Europe for generations to come.
Merz told Germany’s parliament hours before the summit was due to start that Vladimir Putin remained determined that Ukraine should be part of Russia, and he said Berlin would pay its “fair share” to defend Europe.
US President Donald Trump is on his way to the Hague for his first Nato summit since 2019 where all 32 leaders are set to commit to spending 3.5% of national output on defence and a further 1.5% on related infrastructure.
Ahead of a summit overshadowed by Israel-Iran conflict, Nato Secretary General Mark Rutte told his European colleagues to stop worrying about the US commitment to the Western alliance and focus on investing in defence and supporting Ukraine.
He insisted the US president and senior leadership had a “total commitment” to Nato, that came with an expectation of matching American military spending.
Rutte said Europe and Canada had already committed to more than $35bn (£26bn) in military support for Ukraine this year.
Ten people were killed in Russian attacks on Ukraine on Tuesday, and the German chancellor said every attempt to bring Russia to the negotiating table had so far been unsuccessful.
Missile attacks on the eastern city of Dnipro and the nearby town of Samar killed 11 people and wounded another 150, according to the regional chief Serhiy Lysak. A number of children were wounded in the attack on Dnipro, which damaged a kindergarten and a passenger train.
An earlier missile strike on Sumy in the north-east killed three people, including a child.
Ukraine’s Volodymyr Zelensky, who has arrived in The Hague, is due to meet Donald Trump on the sidelines of the Nato summit. It would be their first encounter since they met at Pope Francis’s funeral at the Vatican in April.
Omar Havana/Getty Images
Zelensky (L) was greeted by the Nato secretary general on arrival at The Hague
Nato member states are expected to approve a major new investment plan which will raise the benchmark for defence investment to 5% of GDP.
Many of the allies are far below the commitment to spend 3.5% of GDP on defence by 2035, but the German government backed a budget deal on Tuesday to hit that target by 2029.
Some €62.4bn (£53bn) will be spent on defence in 2025, rising to €152.8bn in 2029, partly financed by debt and special funds.
“We’re not doing that as a favour to the US and its president, we’re doing this out of our own view and conviction, because Russia is actively and aggressively endangering the security and freedom of the entire-Euro-Atlantic area.”
During the summit, Merz is due to meet UK Prime Minister Sir Keir Starmer and France’s President Emmanuel Macron.
Mark Rutte has spent much of the nine months since becoming Nato Secretary General working to get allies to commit to the 5% target. The figure is more than double Nato members’ current 2% guideline and seemed unthinkable – and unrealistic – to most when President Trump first set it in January.
The two-day Nato summit has been scaled back, so that after Tuesday’s dinner hosted by the Dutch king, there will be a working session of under three hours on Wednesday and a five-paragraph statement, apparently to accommodate President Trump.
The wording of the commitment in the statement is key.
While 3.5% of of the target spending will cover core defence requirements, 1.5% will be spent on “defence-related expenditure” – a suitably broad expression that encompasses investments in anything from cybersecurity to infrastructure.
Reaching the 3.5% core defence spending target will still require a significant adjustment for the majority of Nato countries. Out of 32 allies, 27 spend under 3%, with eight hovering well below the 2% threshold set by the alliance in 2014.
He said the UK had to “navigate this era of radical uncertainty with agility, speed and a clear-eyed sense of the national interest”. The UK government said it expected to spend 2.6% of GDP on core defence within two years, alongside 1.5% on defence-related areas.
EPA
Spain’s prime minister Pedro Sánchez has argued his country should be exempt from the 5% spending target
At the bottom of the rung is Spain, whose defence spending is below 1.3%.
Madrid would need to more than double its funding to meet Rutte’s new target – something that Socialist Prime Minister Pedro Sánchez has long resisted, arguing it “would not only be unreasonable but also counterproductive”.
It would also, crucially, be unpopular at home – not least among his left-wing governing coalition – at a time when Sánchez’s government is teetering.
On Sunday Sánchez said Spain had reached a deal that would see it exempted from the target – something Rutte swiftly pushed back on. “Nato is absolutely convinced Spain will have to spend 3.5% to get there,” he said on Monday.
Sánchez’s suggestion of a lower spending threshold was enough for Belgium and Slovakia to also express interest in an exemption – denting Rutte’s hard-won image of a united alliance.
“I can assure you that for weeks our diplomats have been working hard to obtain the flexibility mechanisms,” said Belgium’s foreign minister Maxime Prévot. Brussels’ spending is currently at 1.3% – and Slovakia has also said it reserves the right to decide when to meet the new target.
Despite their comments, all 32 states are expected to sign up to the new pledge.
As Nato leaders and the leaders of more than a dozen partner states made their way to The Hague, train travel from Schiphol Airport near Amsterdam was badly disrupted after cables were damaged by fire.
Security Minister David Van Weel said sabotage could not be ruled out. “It could be an activist group, it could be another country. It could be anything,” he told public broadcaster NOS. “The most important thing now is to repair the cables and get the traffic moving again.”
Two US senators have called on the US Federal Trade Commission to investigate Spotify over allegations that its streaming “bundling” practice harms consumers and could “damage” the marketplace and the music royalty system.
That’s because, under a 2022 legal settlement called Phonorecords IV, music publishers and music streaming services agreed that ‘bundle’ services in the United States are permitted to pay a lower mechanical royalty rate to publishers and songwriters than standalone music subscription services.
In May last year, the Mechanical Licensing Collective (MLC) sued Spotify for allegedly underpaying royalties to songwriters and publishers after reclassifying its Premium Individual, Duo, and Family subscription streaming plans as Bundled Subscription Offerings because those plans now offer access to audiobooks.
The lawsuit was dismissed in January, and the MLC asked the court in February to reconsider the dismissal.
On Friday (June 20), Senators Marsha Blackburn, a Tennessee Republican, and Ben Ray Luján, a New Mexico Democrat, sent a letter to Federal Trade Commission Chairman Andrew Ferguson, requesting an investigation into Spotify’s bundling practice.
They wrote: “We have serious concerns about Spotify’s recent move to convert all of its premium music subscribers into different—and ultimately higher-priced — bundled subscriptions without their knowledge or consent.”
“These actions harm consumers and could deeply damage the marketplace and the music royalty system. We urge the FTC to investigate the impact of Spotify’s recent actions.”
Marsha Blackburn and Ben Ray Luján, US Senators
The letter added: “These actions harm consumers and could deeply damage the marketplace and the music royalty system. We urge the FTC to investigate the impact of Spotify’s recent actions, to take steps to protect Americans from being forced into subscriptions without notice or choice, and to safeguard the music marketplace.”
The senators allege Spotify “exploited” federal copyright regulations by automatically converting Premium subscribers into bundled plans that include audiobooks without consumers’ consent or notice. This allowed the platform to pay a lower music royalty rate, they wrote.
“Spotify’s intent seems clear—to slash the statutory royalties it pays to songwriters and music publishers. Not only has this harmed our creative community, but this action has also harmed consumers.”
“Spotify’s intent seems clear — to slash the statutory royalties it pays to songwriters and music publishers. Not only has this harmed our creative community, but this action has also harmed consumers.”
Marsha Blackburn and Ben Ray Luján, US Senators
Earlier this month, the National Music Publishers’ Associationsaid Spotify‘s decision to reclassify its premium music service as a bundled offering, has, “by Spotify’s own numbers” resulted in a $230 million loss for publishers during its first year of implementation.
The NMPA projects that music publishers will “lose over $3.1 billion” through 2032 due to Spotify‘s bundling practice.
The senators allege that Spotify’s audiobooks service “is set at an artificially high price for the purpose of gaming federal regulations and deeply cutting music royalty payments.”
Spotify’s standalone Audiobook Access plan costs $9.99 monthly for 15 hours of listening from a catalog of 200,000 titles, while its music-only Basic Plan provides unlimited access to over 100 million songs for just $10.99.
The senators wrote: “Under the regulations, the higher the Audiobooks Access plan is priced, the lower the music royalty Spotify must pay. Additionally, Spotify’s licenses for audiobooks are consumption-based, so Spotify has little downside if the Audiobooks Access plan is overpriced.
Their letter added that, following “pushback” last year, Spotify “quietly re-launched” a music-only subscription option called the Basic Plan. However, Senators Blackburn and Luján said this tier is only available to certain existing subscribers, not new subscribers.
“[Spotify’s] approach to expanding its offering and raising prices is industry standard. We notify users a month in advance of any price increases and offer easy cancellations as well as multiple plans for users to consider.”
Spotify representative
They wrote: “Spotify has hidden the Basic Plan so that existing subscribers must jump through endless hoops to find the option. As of January 2025, only a handful of Spotify’s millions of Premium Plan subscribers switched back to a music-only ‘Basic’ plan.”
A Spotify representative issued a response via Variety on Friday, saying the company’s “approach to expanding its offering and raising prices is industry standard” and that it “notif[ies] users a month in advance of any price increases and offer easy cancellations as well as multiple plans for users to consider” as part of an effort to “provide consumers incredible value and a best-in-class experience”.
The senators’ intervention represents the latest bipartisan action over Spotify’s bundling practice. Last year, Blackburn was joined by Democrat Congressmen Ted Lieu and Adam Schiff in writing a letter addressed to Shira Perlmutter, the US Register of Copyrights, raising questions about whether Spotify’s move is in line with the spirit of the Music Modernization Act (MMA) of 2018.
“Few would expect customers to purchase audiobooks at that rate when it is available for free with the music service for only $1 more per month. This was, however, the same moment in which Spotify automatically reclassified the 50 million subscribers in its music services into a bundle,” they wrote at the time.
At the NMPA’s 2025 Annual Meeting, the organization’s Executive Vice President and General Counsel Danielle Aguirrehighlighted how the streaming giant’s bundled offering has, “by Spotify’s own numbers” resulted in a $230 million loss for publishers in its first year.
“We are extremely pleased that United States senators Blackburn and Lujan are also asking the FTC to investigate this as it will have ripple effects across other platforms.”
Aguirre said: “These losses will continue if we can’t reverse or correct Spotify’s actions. In fact, if we don’t stop them, we are projected to lose over $3.1 billion through the next CRB period,” which will be Phonorecords V, which determines mechanical royalty rates for 2028 through 2032.
NMPA President and CEO David Israelite issued a statementon Friday, saying: “As we have said since they started their bundling scheme last year – Spotify’s forced conversion of subscribers doesn’t only hurt songwriters – it hurts consumers.
“We are extremely pleased that United States senators Blackburn and Lujan are also asking the FTC to investigate this as it will have ripple effects across other platforms. These unfair business practices hurt music creators and users and it must stop.”
Iran launched a deadly strike in Beersheba, Israel, and Israel struck targets in Tehran early Tuesday, Israeli officials said, hours before the countries confirmed they had agreed to a cease-fire.
Your guide to what Trump’s second term means for Washington, business and the world
Top central bankers have delivered a scathing assessment of stablecoins, saying they “perform badly” on key requirements for being widely used as money, disavowing US President Donald Trump’s push to make them a pillar of mainstream finance.
The Bank for International Settlements said stablecoins fail the three main tests of any money because they are not backed by central banks, lack sufficient guardrails against illicit usage and do not have the flexibility of funding needed to generate loans.
Stablecoins are designed to act as a bridge between volatile crypto assets such as Bitcoin and traditional monetary systems by tracking the value of fiat currencies with one-for-one backing in safer assets such as government bonds and money market funds.
Their creators boast that by transferring money over the internet, they are more efficient than international bank transfers. However, the fact that they can be held anonymously has made them popular with crypto traders and a conduit for crime including drug trafficking and money laundering.
Hyun Song Shin, head of the BIS monetary and economic department, told reporters that stablecoins carried the risk of rapid withdrawals by investors. “It’s really asking, if there are such redemptions in the stablecoin space, what would be the consequences,” he said.
Governments in the US and UK are introducing regulatory frameworks for stablecoins in response to their growing usage. There are about $250bn in circulation already, dominated by dollar-based tokens such as Tether and Circle’s USDC.
Since Trump won last year’s presidential election with a pledge to “make the US the crypto capital of the world”, his administration has revoked many Biden-era restrictions on crypto usage. The president is also a backer of World Liberty Financial, a cryptocurrency group with its own stablecoin USD1.
The BIS, the forum for the world’s main central banks, said in a chapter from its annual economic report released on Tuesday: “While stablecoins’ future role remains uncertain, their poor performance on the three tests suggests they may at best serve a subsidiary role.”
Stablecoins “have been the go-to choice for illicit use to bypass integrity safeguards”, the report said, pointing out that they lack the “know-your-customer” controls of traditional finance.
It found they “fare poorly” in the settlement function of money due to their lack of backing by central banks, which act as lenders of last resort in a crisis.
“Stablecoins often trade at varying exchange rates, undermining singleness,” it said. “They are also unable to fulfil the ‘no questions asked’ principle of bank-issued money.”
Due to their need to always be backed by an equivalent amount of assets, they also do not have the “elasticity” that allows banks to create extra money by granting loans, the BIS said.
“Any additional issuance requires full upfront payment by holders, which undermines elasticity by imposing a ‘cash-in-advance’ constraint,” it added.
Warning that “loss of monetary sovereignty and capital flight are major concerns, particularly for emerging market and developing economies”, the BIS said bank-issued stablecoins “may introduce new risks, depending on their legal and governance arrangements”.
The body believes it would be better to create a centralised database of tokenised deposits of central banks and commercial banks to speed up and cut the cost of cross-border payments.
It is trialling such a system with seven major central banks and 43 commercial institutions, called Project Agorá.
“Society has a choice,” the BIS said. “The monetary system can transform into a next-generation system built on tried and tested foundations of trust and technologically superior, programmable infrastructures.”
“Or society can relearn the historical lessons about the limitations of unsound money, with real societal costs, by taking a detour involving private digital currencies that fail the triple test of singleness, elasticity and integrity.”
