Digitalisation has changed the way monetary systems work for many years already, but recently it hasstarted to change its structure more fundamentally. Developed economies rapidly reduce the
importance of cash, and in some cases envisage becoming cashless entirely in the foreseeable future. At the same time digital currencies have appeared. The first wave of cryptocurrencies such as Bitcoin, Ethereum or Ripple have failed to gain relevance in terms of their share in monetary transactions. This was due to systemic deficiencies leading to extreme volatility, limited capacity, unpredictable transaction costs and limited transparency, which have reduced their ability to fulfil the basic functions of money and hence their attractiveness as a medium of exchange.1 More recently, stablecoins have entered the scene which were specifically designed to deal with the issue of volatility by tying the digital currency to an underlying set of assets. Another important difference to the first generation of cryptocurrencies is that they rely on third-party institutions to some extent and may be issued by a central entity.