Private money, public trust: The stablecoin battle

What makes money… money? And who should we trust to issue it?In this episode of Econ To Go, Neale Mahoney sits down with Stanford finance professor Amit Seru to explore the tug-of-war over the future of money. Stablecoins promise fast, low-cost digital payments, but Seru explains why they function much like narrow banks — vulnerable to runs if confidence erodes. The conversation examines the GENIUS Act’s attempt to add guardrails for this unique type of crypto, the risks of delegating core financial functions to private issuers, and why trust remains the foundation of any stable currency. We cover several key themes, including:(01:10) What’s at stake: Stablecoins and the future of money(05:35) The GENIUS Act: What it does, what it doesn’t(09:44) Run risk, backstops and regulatory gaps(14:34) Private innovation and public power(20:40) American trust in digital money(26:50) To buy or not to buyEcon To Go brings Stanford economics into your everyday life — served with a side of coffee. Hosted by economist and director of the Stanford Institute for Economic Policy Research (SIEPR), Neale Mahoney, the show takes you on a walk across campus with leading thinkers as they unpack the ideas shaping our economy, public policy, and daily lives. Smart, curious, and conversational — it’s Stanford economics, to go.The Stanford Institute for Economic Policy Research is a nonpartisan research center that brings together scholars, policymakers, and industry leaders to solve pressing economic challenges and inform better public policy.Never miss an episode. Subscribe to Econ To Go on Spotify, Apple Podcasts, Amazon, YouTube, or wherever you get your podcasts. Plus follow SIEPR on LinkedIn or X/Twitter for episode updates and research highlights, or explore more at siepr.stanford.edu.Today’s guest, Amit Seru, is the Steven and Roberta Denning Professor of Finance at Stanford and a senior fellow at the Stanford Institute for Economic Policy Research. To learn more about him and his work on financial regulation and stablecoins, explore his bio and these recent pieces: We Really Want to Trust Crypto Interests With the Future of Money? - The New York Times Can Markets Trust Stablecoins? - WSJRaise bank equity or keep rolling the dice