Stablecoin is a type of cryptocurrency pegged to fiat currency, initially created to address the severe price volatility of digital assets like Bitcoin and Ethereum. By pegging to fiat currencies like the US dollar, stablecoins achieve relatively stable value— for example, 1 USDT ≈ 1 USD.
Currently mainstream stablecoins include:
USDT (Tether): the most widely used globally
USDC (issued by Circle): regulated by the US, regarded as a representative of normalization
USDD and other emerging stablecoins
💳 Why are stablecoins important?
Traditional US dollar cross-border payments rely on the SWIFT system, but it has several persistent issues:
High transaction fees
Slow settlement
Not operating 24/7
Many intermediaries
Stablecoins based on blockchain can achieve:
✅ Extremely low transaction fees
✅ Instant settlement
✅ 24/7 round-the-clock settlement
✅ No need for banking intermediaries
This makes cross-border trade, overseas remittances, and global payments more convenient and efficient.
💵 The hidden link between US stablecoins and US Treasuries
Many people do not know that US stablecoins are not only payment tools but are also deeply tied to **US Treasuries**:
Issuers will allocate most of their reserve funds to US Treasuries
Global investors holding stablecoins are actually participating indirectly in US debt financing
This mechanism provides the US with a new channel for debt digestion, alleviating fiscal pressure
Behind this is a precise financial layout: utilizing the international hegemony of the dollar and a mature credit system to encourage users worldwide to voluntarily participate in the US debt cycle while enjoying low-cost capital flow efficiency.
⚖️ The US 'co-optation' strategy
The rise of stablecoins may challenge the dollar system but can also enhance dollar influence. The US's choice is to bring it under regulation:
Ensure that stablecoins rely on the dollar as a peg
Ensure that the US dollar continues to hold its core position in the era of digital currency
Avoid the emergence of a new settlement system that bypasses the dollar
🔐 Trust is the lifeline
The biggest challenge for stablecoins is whether they can truly achieve a 1:1 fiat reserve.
If reserves are sufficient, users are willing to hold for the long term
If reserves are insufficient, once confidence collapses, prices will quickly decouple, triggering a chain reaction of risks
🌍 Global impact and risks
The popularity of stablecoins is reshaping the financial landscape:
Reduce dependence on traditional banks
Change the way cross-border capital flows
Pose a challenge to the long-term status of sovereign currencies
In the next 5 to 10 years, stablecoins will not only be a technological innovation but also a catalyst for the adjustment of the global financial power structure.
📌 Summary
Stablecoins are pushing digital currencies into a wider range of application scenarios and driving reforms in payment and financial systems globally. Its convenience and potential cannot be ignored, but the underlying financial games and risks also deserve long-term attention.