Stablecoin: "The 'Stable Currency' that Generates Billions in Profit"

In 2024, #stablecoin achieved a trading volume of over 27.6 trillion USD, surpassing both Visa and Mastercard combined. Although its value is always pegged 1:1 with USD, stablecoin issuers are reaping enormous profits, notably Tether (USDT) with a net profit of 13 billion USD.

Three main models of stablecoins:

Fiat-backed: Backed by real money (USDT, $USDC ), safe, easily redeemable for USD.

Crypto-backed: Collateralized by crypto (DAI), decentralized but carries high risks when prices fluctuate.

Algorithmic: Stabilized by algorithms, notably highlighted by the “collapse” of TerraUSD (UST).

How stablecoin companies make money:

Interest from reserve assets – the largest source of revenue. USD exchanged for USDT/USDC is invested in short-term U.S. government bonds, benefiting significantly when the Fed maintains high interest rates (~5%).

Investment outside reserves – #Tether uses profits to purchase over 100,000 BTC, 50 tons of gold, and invest in over 120 AI, DeFi, fintech companies.

Fees for exchanging stablecoins – Organizations withdrawing large amounts of USDT/USDC for USD must pay a 0.1% fee, creating a significant revenue stream.

Challenges: Increased regulatory scrutiny (MiCA, GENIUS Act), the trend of many countries issuing local currency stablecoins, and dependence on global interest rates.

👉 Despite facing regulatory pressures and competition, stablecoins remain a "gold mine" in Web3, turning issuing companies into digital intermediaries with profits that are far from stable, just like its name suggests. #anh_ba_cong