IMF Meetings Highlight Stablecoin Risks as G7 Bond Yields Rise

Rising government bond yields and digital finance risks converged at the Oct. 12-18 International Monetary Fund (IMF)-World Bank meetings in Bangkok, putting stablecoin reserve markets under closer scrutiny.

Global public debt is projected to exceed 100% of world GDP by 2030. From February to September 2026, the G7 average for 10-year government bond yields climbed by more than one percentage point. Higher yields raise governments’ borrowing costs and can affect borrowing costs beyond their borders.

The yield increase adds a measured figure to an earlier warning about a sharp, disorderly rise in government bond yields. Heavy public debt leaves governments more exposed to changes in financing costs, while pressure in one sovereign bond market can reach others. The debt projection and yield comparison describe different measures: one is a forecast for the global debt burden, and the other tracks G7 borrowing costs over seven months.

Digital finance featured in the financial stability discussion because risks in newer markets can connect with established ones. Tokenized asset markets remain small, but their growth could create additional ways for liquidity strains to move through markets. Greater use of tokenization could also increase dependence on technology and market infrastructure. Liquidity transmission and reliance on infrastructure are separate concerns.

Stablecoins present a more direct link to government bonds. Issuers hold those bonds among the assets backing their tokens, and large redemptions could put pressure on the markets where the bonds trade.

Artificial intelligence added another possible source of market strain. Disappointing AI investment or profits could trigger a correction in AI-related assets, with leverage and concentrated holdings magnifying losses. The risk concerns financial exposure to AI as well as the durability of returns from spending on the technology.

The meetings also produced a narrower funding proposal related to Ukraine. At an Oct. 15 meeting in Bangkok, several G7 members announced intended contributions totaling €260 million toward repairs to the Chornobyl nuclear plant’s protective structure. The contributions remain subject to national procedures, so the announcement does not establish that the money has been delivered.

The structure was damaged in February 2025, and repairs are estimated to cost at least €500 million. The intended contributions would cover only part of that estimate. A donor conference is planned for Nov. 9 in Paris to address the remaining funding need.