CBDC vs stablecoin: key differences and 2026 status

A central bank digital currency is money issued by a central bank, while a stablecoin is a private token backed by reserves, and in 2026 the US has barred federal work on the first while the EU is still legislating for it.

The difference between a CBDC and a stablecoin comes down to who issues it. A central bank digital currency (CBDC) is a direct liability of a central bank, the digital equivalent of a banknote. A stablecoin is issued by a private company that holds cash and short-term government debt as reserves and promises to redeem each token at face value. On 23 September 2026 stablecoins in circulation totalled more than $311 billion, according to DefiLlama, while only three countries had fully launched a retail CBDC.

The two also sit on opposite sides of US policy. An executive order signed in January 2025 barred federal agencies from working on a CBDC, and the GENIUS Act, signed six months later, set up a federal licence for stablecoin issuers. Europe has taken both paths at once, regulating euro stablecoins under MiCA while negotiating a law for a digital euro.

Is a CBDC a type of stablecoin?

No. A CBDC is the national currency itself in digital form, so its value can't drift from the currency it represents. A stablecoin tracks a currency through a promise of redemption, and its price holds only as long as holders trust the issuer's reserves and its ability to pay out. When Silicon Valley Bank failed in March 2023 with part of Circle's reserves inside it, USDC briefly traded well below $1, a risk a central bank liability doesn't carry in the same way.

They also run on different systems. Stablecoins live on public blockchains such as Ethereum, Solana and Tron, where anyone with a wallet can hold them. Most CBDC designs run on ledgers controlled by the central bank or its contractors, with access through banks and licensed payment apps.

CBDC vs stablecoin side by side

Status as of 23 September 2026, from the sources linked in each section.

Why did Trump stop the CBDC?

President Trump signed Executive Order 14178 on 23 January 2025. It describes CBDCs as a threat to "the stability of the financial system, individual privacy, and the sovereignty of the United States", bars agencies from any action to "establish, issue, or promote CBDCs", and orders any ongoing CBDC plans to be terminated. The Federal Reserve had never committed to issuing one, so the order closed off research more than a live project.

Congress hasn't written the ban into law yet. The Anti-CBDC Surveillance State Act passed the House 219 to 210 on 17 July 2025, the same week as the GENIUS Act, and on 23 September 2026 congress.gov still showed no Senate vote on it. A future president could reverse the executive order, which is why supporters want the ban in statute.

Why are banks against stablecoins?

Banks fund their loans with deposits, and a stablecoin that paid interest would compete directly for those deposits. The Treasury Borrowing Advisory Committee estimated in 2025 that as much as $6.6 trillion in bank deposits could be exposed, depending on whether stablecoins can offer yield. The American Bankers Association and the Bank Policy Institute have argued this outflow would shrink lending, especially at community banks.

The GENIUS Act was the compromise. Section 4(a)(11) of Pub. L. 119-27 bars a permitted issuer from paying holders "any form of interest or yield" solely for holding the coin. The fight has since moved to distributors:

• The bank position: the Bank Policy Institute says exchanges and affiliates can still pass reserve income to holders as rewards, and wants the gap closed.
• The research so far: a March 2026 Congressional Research Service note confirms GENIUS doesn't explicitly stop exchanges paying rewards, and an April 2026 White House Council of Economic Advisers report found a yield ban would do "very little" to protect bank lending (ABA Banking Journal).
• The legislative vehicle: banks had pushed to close the gap in the CLARITY Act, which stalled after a failed Senate procedural vote on 15 September 2026.

Our explainer on how the GENIUS Act and CLARITY Act reshape stablecoin yield covers both laws in detail.

Which countries have banned or halted CBDCs?

The Atlantic Council's CBDC tracker counted 146 countries exploring a CBDC in its May 2026 update, representing more than 98% of global GDP. Only a few have stopped:

• United States: federal CBDC work banned by Executive Order 14178 in January 2025.
• Ecuador: ran a central bank electronic money system from 2014 and shut it down in 2018, after the National Assembly voted to open the market to private providers (Human Rights Foundation tracker).
• Denmark: Danmarks Nationalbank concluded in 2022 that a retail e-krone wouldn't improve on existing payments.

Three countries have fully launched a retail CBDC, according to the Atlantic Council: the Bahamas (Sand Dollar), Jamaica (JAM-DEX) and Nigeria (eNaira). China's e-CNY is still classed as a pilot despite its size, and since 1 January 2026 balances in e-CNY wallets earn interest at demand deposit rates (Reuters).

Where CBDCs and stablecoins stand in 2026

• GENIUS Act: regulators missed the July 2026 deadline for final rules, so the law takes effect on 18 January 2027, and the OCC has said it aims to finalise its rule by November (The Block).
• Digital euro: the European Parliament voted 416 to 169 on 9 July 2026 to open negotiations with the Council, which began on 13 July. If the law passes in 2026 the ECB plans a pilot in 2027 and a first issuance in 2029, so the digital euro isn't in pilot yet (European Parliament).
• Stablecoin supply: USDT stood at about $183 billion and USDC at about $75 billion on 23 September 2026, and the two dominate the market (USDC vs USDT compared).

Where holders earn a return

Neither a digital euro nor a regulated stablecoin pays its holder interest in the US or the EU. China's e-CNY is the main exception. Any return on a dollar or euro stablecoin comes from a layer on top, such as lending markets, exchange rewards funded by distribution deals, or onchain vaults that deploy the coins into strategies.

Upshift runs that vault layer, with more than 50 vaults across more than 30 chains and 10 smart contract audits by 6 independent firms. The routes and their risks are laid out in how to earn yield on stablecoins in 2026.

Frequently asked questions

Is a CBDC a stablecoin?

No. A CBDC is issued by a central bank and is the national currency itself, while a stablecoin is a private token that holds its value through reserves and a redemption promise.

Why did Trump ban CBDCs?

Executive Order 14178, signed on 23 January 2025, cites risks to financial stability, individual privacy and US sovereignty. It stops federal agencies from creating or promoting a CBDC and ends any existing plans.

Why are banks against stablecoins?

Banks worry that stablecoins paying interest would pull deposits away and reduce lending. The GENIUS Act bars issuers from paying yield, and banks are now lobbying to extend that ban to exchanges and other distributors.

Which countries have banned CBDCs?

The United States banned federal CBDC work by executive order in 2025. Ecuador shut down its central bank e-money system in 2018, and Denmark's central bank decided against a retail e-krone in 2022.

Is the digital euro a CBDC?

Yes. It would be issued by the European Central Bank and wouldn't pay interest under the current proposal. The ECB is aiming for a first issuance in 2029 if EU lawmakers pass the legislation in 2026.

Do stablecoins pay interest?

Issuers can't pay holders interest under the GENIUS Act or MiCA. Holders can earn by lending stablecoins or depositing them in a vault, which adds the risks of that platform.

Keep reading

• How RWA-backed stablecoins generate yield. Where Treasury-backed tokens get their return.
• How neobanks and fintechs offer stablecoin yield. The earn models behind consumer apps.
• What is RLUSD. Ripple's dollar stablecoin and how it's regulated.