No. It’s about connectivity.

Payments basics: Simplest scenario (details overly simplified) When you send money from account A on bank X to account B on bank Y, what happens is that Bank X debits account A on its system and credits bank Y’s account on bank X (let’s say it’s Xy account) Then bank X sends message to Bank Y to credit account B, so Bank Y debits X’s bank account (Yx) and credits B.

As you can see this is an issue, it means that every bank has to have an account on every other bank in order to have funds moving around, and even keep liquidity there.

That’s where Clearing And Settlement system comes in, they act as a centralised force.

So instead of bank X having an account (with enough liquidity ) on bank Y so that its customers can transfer money to Bank Y customers, both of these banks have an account on some Clearing/Settlement third party (usually it’s a system by a Central Bank) and interact with that system instead, so instead of N*N bank accounts on outer banks, you have N accounts on central system.

EU has TARGET from ECB for settlement of euros across EU.

But there is no central bank of the whole world of every currency.

So what happens when too far away banks interact?

They have to search through the graph of all the world banks how they can get money to a particular bank. Add currency conversion as an extra complexity, because every connection is on a currency.

So it’s quite the graph search with many constraints, clearing and settling such stuff is hard because of that.

Regulation and AML is just one of the difficulties in linking nodes, but other exists, for example liquidity, a small bank can’t just spread multi currency accounts on many places.

The benefit of stablecoin on a blockchain, is that it kinda gives you “whole world central bank”, more correctly, it makes everybody share the same ledger, instead of each bank having its own that needs reconciliation with everybody else.

The only thing extra needed for stable coins, is space for encrypted messages is a transfer(so that a bank can tell other bank to credit customer B) and a public mapping from Bank Bic to crypto wallet id.