Thu, September 19, 2024 at 15:04

• 

  Kang-hoon

  • Hello, Annie.

  • Today, I have some interesting news regarding the increasing role of stablecoins in the global financial system.

  • 
• Annie

  • Oh, that sounds fascinating!

  • Could you tell me more about it?😊

  
• 

  Kang-hoon

  • Certainly.

  • According to a report by brokerage Bernstein, stablecoins have now become the 18th-largest holding of U.S. Treasury bonds.

• Annie

  • Wow, that's impressive!

  • So, what exactly are stablecoins?

  
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• 

  Kang-hoon

  • Stablecoins are cryptocurrencies designed to maintain a fixed value, often pegged to the U.S. dollar.

  • Some are also pegged to other assets like gold or different currencies.

• Annie

  • I see.

  • How has their usage changed recently?

  
• 

  Kang-hoon

  • After a brief dip in supply in 2023, stablecoins have rebounded.

  • Their circulating supply is now at an all-time high of $170 billion, and the monthly on-chain payments volume has tripled over the past 12 months, reaching $1.4 trillion in July.

  • 
• Annie

  • That's a significant increase!

  • What are the main reasons behind this growth?

  
• 

  Kang-hoon

  • Bernstein analysts attribute this to the increasing integration of stablecoins into fintech and payment systems.

  • Companies like PayPal, MercadoLibre, and Grab are incorporating stablecoins for payments and cross-border transactions.

• Annie

  • Interesting.

  • How do stablecoins benefit cross-border payments?

  
• 

  Kang-hoon

  • Stablecoins, especially those backed by the U.S. dollar, are currently the cheapest means of cross-border payments.

  • For example, sending $1000 through a layer 2 blockchain can cost as little as 1 cent.

• Annie

  • That's incredibly cost-effective!

  • Are there any other notable uses for stablecoins?

  
• 

  Kang-hoon

  • Yes, outside of the U.S., stablecoins are popular as a store of value compared to local currencies.

  • This is especially true among young people aged 18 to 24 in emerging markets.

• Annie

  • How prevalent is this trend among young investors?

  
• 

  Kang-hoon

  • According to Bernstein, 20% of young investors in emerging markets allocate 25-50% of their portfolio to stablecoins.

• Annie

  • That's a substantial portion of their investments!

  • How many people are currently holding stablecoins?

  
• 

  Kang-hoon

  • There are currently 8.7 million holders of stablecoins, which is more than the number of USDT holders.

• Annie

  • This is all very enlightening.

  • So, do you think this news is positive or negative for the market?

  
• 

  Kang-hoon

  • I would say it's a positive development.

  • The increasing adoption and integration of stablecoins into mainstream financial systems indicate a growing acceptance and utility, which can lead to more stability and efficiency in the market.

• Annie

  • Thank you, Kang-hoon.

  • This has been very informative!😊

  
• 

  Kang-hoon

  • Upon comprehensive consideration, this news is perceived as a 😍Bullish.