Increased Interest in Non-USD Pegged Stablecoins
Governments outside the U.S., such as Singapore, are increasingly interested in non-USD-pegged stablecoins, although liquidity is currently quite limited. According to Dea Markova, while attending Token2049, the competition with USD-pegged stablecoins is closely related to sovereignty issues. This is similar to previous conflicts between governments and U.S. payment giants like Visa and Mastercard, but is now occurring with stablecoins on a smaller scale.
Pressure from the European Central Bank
The neo USD stablecoin in the European Union is facing "impressive difficulties" from the central bank. The European Central Bank is increasing pressure to develop a digital euro, concerned about the systemic impact of the neo USD stablecoin in the euro area. This creates challenges for stablecoins like USDT and USDC, which have already dominated the market.
Pioneering in Regulatory Thinking
Dea Markova also emphasized that the United Arab Emirates is leading in regulatory thinking for stablecoins. Abu Dhabi is adopting a more reasonable approach, allowing access to liquidity and global payments without requiring stablecoin issuers to reside or have local licenses. USDT and USDC have received approval in Abu Dhabi, amid organizations collaborating to launch a USD-pegged stablecoin regulated to the dirham.
Analysis of Systemic Challenges
The market capitalization of stablecoins is mainly dominated by USD-pegged coins. Markova suggests that this phenomenon parallels previous conflicts with U.S. payment organizations and is increasingly emerging as a sovereignty concern for nations. The Bank of Italy has reported that dependence on U.S. Treasury bonds may increase systemic risks for USD-pegged stablecoins.
In this context, researching and applying stablecoins not pegged to the USD could become a driving force for cryptocurrency strategies in many countries.
Source: https://tintucbitcoin.com/global-demand-increases-for-non-usd-stablecoins/
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