IMF first deputy managing director Dan Katz warns that even locally issued stablecoins may ultimately funnel more capital toward digital dollars, complicating monetary policy in emerging markets. Countries that launch their own domestic stablecoins might inadvertently boost demand for the very dollar-backed tokens they were designed to compete with. AdvertisementThe digital dollar’s gravitational pullKatz’s remarks build on a theme he has been developing since taking the first deputy managing director role in October 2025. The moment it touches cross-border commerce, traders and consumers discover that dollar-backed tokens settle faster, trade in deeper pools, and are accepted by more counterparties worldwide. Emerging markets feel the squeezeThe IMF’s concerns did not emerge in a vacuum.