Stablecoins are booming, but what exactly are they? Since the listing of Circle, the 'first stock of stablecoins', its cumulative increase has reached 440% in just half a month.
On June 17, Liu Qiangdong, chairman of JD Group, stated at a sharing session that JD has six innovative projects, one of which is stablecoins.
On June 18, Wednesday, Pan Gongsheng, governor of the People's Bank of China, mentioned stablecoins for the first time at the 2025 Lujiazui Forum.
Many people are asking: what exactly are stablecoins?
In fact, they are not only an innovation in the crypto world but also a key bridge between traditional finance and the Web3 era.
With the spirit of decentralization of blockchain, they carry the trusted assets of the centralized world, creating an unprecedented financial form.
The financial system we are familiar with today can roughly be seen as a product of the Web1.0 or 2.0 era, relying on central banks, institutions, and rules, with the issuance and value endorsement of currency being highly centralized.
This system brings stability but also comes with a crisis of trust in central nodes. The financial world of Web3 completely reverses this: it is built on blockchain, where everyone has an immutable 'ledger', and decentralized trust is supported by code and consensus.
The emergence of stablecoins happens to find a junction between these two worlds.
Their ledger is on-chain, public, transparent, and immutable, reflecting the spirit of decentralization; yet the underlying assets they are pegged to, such as the US dollar, government bonds, gold, etc., are still relatively trusted centralized assets. This makes them a transitional form that connects 'traditional faith' and 'future faith'.
Those who distrust traditional finance can see the feasibility of decentralization through stablecoins; and those who believe in traditional finance can gradually understand and accept the logic of the Web3 world with the help of stablecoins.
So, to sum it up in one sentence: stablecoins allow traditional finance people to see the possibility of decentralization while also letting Web3 believers see the expansion path of traditional finance. This is what I believe to be their most core value at present, and it may also be the greatest potential for the future.
However, with stablecoins being so hot, one should not overlook the risks; people can easily be misled by superficial technological innovations while neglecting the in-depth analysis of the essence of assets.
