The global explosion of stablecoins is not coincidental but rather the result of the interplay between technology, financial demand, and geopolitical factors. Its underlying logic is to address the volatility issue of cryptocurrencies while serving as a bridge between traditional finance and the digital economy. The following analyzes this phenomenon from five dimensions:

I. Core Drivers of Global Explosion

1. Financial Inclusion and Efficiency Revolution

- Sharp Decline in Cross-Border Payment Costs: Traditional SWIFT cross-border remittance fees can be as high as 5% to 10%, while stablecoins can achieve settlement in seconds with costs below 1%, becoming mainstream in remittance-heavy countries like the Philippines and Mexico.

- Counteracting Fiat Currency Depreciation: Countries like Argentina and Nigeria, with annual inflation rates exceeding 100%, have shifted over 50% of their savings to dollar stablecoins for risk aversion, forming 'digital dollarization.'

2. Acceleration of Regulatory Compliance

- By 2025, the United States (GENIUS Act), the EU (MiCA framework), and Hong Kong (stablecoin regulations) will establish global regulatory standards, eliminating 'gray areas.'

- Compliance has led traditional institutions like BlackRock and Visa to enter the market in large numbers, pushing stablecoins from the crypto space into mainstream finance.

3. The Invisible Hand of the Government Bond Market

- Stablecoins need to anchor to highly liquid assets, **US short-term government bonds become the preferred reserve**. Currently, Tether (USDT) holds over $120 billion in US Treasuries, ranking as the 19th largest sovereign holder globally; if the market size reaches $3.7 trillion by 2030 (as predicted by Citibank), it could absorb over $1 trillion in government bonds, becoming a 'supporting force' for US Treasuries.

II. The Underlying Logic of Stablecoins: Triangular Balance Model

1. Trust Anchoring Mechanism

| Type | Representative Tokens | Collateral Assets | Risk Points |

| Fiat-Collateralized | USDT/USDC | Dollar + US Treasuries | Transparency of Centralized Institutions |

| Over-Collateralized Crypto Assets | DAI | ETH and other cryptocurrencies | Collateral Price Crash |

| Algorithmic Stablecoin | USDe | Derivatives Hedging | Market Liquidity Crisis |

Currently, 90% of market value is concentrated in fiat-collateralized stablecoins, as they are the most stable.

2. Dual Benefits of Economic Models

- Issuer Profits: Taking Circle (the issuer of USDC) as an example, revenue in 2024 is projected to be $1.676 billion, with 99% derived from interest income on reserves invested in US Treasuries (annualized over 5%).

- User Earnings: DeFi protocols (like Aave) offer up to 14% stablecoin deposit returns, though lower than US Treasuries, they excel in on-chain instant availability.

III. The Triangular Relationship Between Cryptocurrencies, the Dollar, and Stablecoins

1. Cryptocurrency ↔ Stablecoin: Symbiotic Foundation

- Transaction Lubricant: Volatile assets like Bitcoin require stablecoins as a medium of exchange, with 80% of transactions in the crypto space settled through USDT/USDC.

- DeFi Ecosystem Fuel: Lending protocols (Compound), derivatives platforms (dYdX) rely on stablecoins as underlying collateral.

2. Dollar ↔ Stablecoin: Extension of Hegemony

- Digital Carrier of the Dollar: 99% of stablecoins are pegged to the dollar, with Federal Reserve officials stating that 'stablecoins reinforce the global status of the dollar.'

- Geopolitical Financial Tool: The US requires stablecoin reserves to predominantly consist of dollars and US Treasuries through the (GENIUS Act), forcing global stablecoin users to passively hold dollar assets.

3. Triangular Cycle Effect

A[US Dollar Hegemony] -->|Support Regulation| B(Stabelcoin)

B -->| As Trading Pair | C[Cryptocurrency Market]

C -->| Demand Growth | B

B -->| Buy US Treasuries | A

This cycle allows the US to gain 'triple benefits': expanding the circulation of the dollar, low-cost financing, and harvesting global blockchain productivity.*

IV. Regulatory Games and Market Structure Evolution

1. Divergence of Major Power Policies

- United States: Encourages private stablecoins (like USDC) but resists CBDCs (Central Bank Digital Currency) to avoid direct government control.

- China: Hong Kong plans to launch a stablecoin regulatory system in 2025, promoting offshore RMB stablecoin pilots, challenging the dominance of the dollar.

- European Union: The MiCA framework requires transparency of reserve assets from stablecoin issuers, with USDC capturing market share due to compliance.

2. Market Centralization Crisis

- Duopoly Monopoly: USDT (62%) + USDC (25%) control nearly 90% of the market, with emerging stablecoins like USDe (Ethena Labs) growing quickly but only occupying 3%.

- Traditional Institutions Entering: PayPal issues PYUSD, JPMorgan pushes JPM Coin, potentially disrupting the landscape with their user base.

V. Future Trends: Reconstructing Global Financial Infrastructure

1. Alternative Banking Functions

The payment volume of stablecoins (on-chain settlement of $11.1 trillion in 2024) is approaching Visa's ($11.6 trillion) and may replace commercial bank deposit functions in the future.

2. National Currency Alliance Chain

- Payment systems in countries like Brazil (PIX) and India (UPI) are integrating stablecoins, forming a 'sovereign on-chain settlement layer.'

- Projects like PlatON are building cross-chain payment protocol TOPOS, attempting to become the 'Web3 version of the VISA network.'

3. Wave of Tokenization of Government Bonds

Standard Chartered Bank predicts: The stablecoin market will reach $2 trillion by 2028; if 30% of reserves are allocated to US Treasuries, it will create an incremental demand of $600 billion for the US Treasury—equivalent to Japan's annual bond purchasing scale.

Summary

The essence of stablecoins is the on-chain extension of dollar hegemony and a breakthrough point for global financial efficiency. Its explosion stems from threefold thrusts:

- Technological Push: Blockchain enables low-friction value transfer;

- Economic Thrust: High yields on US Treasuries create arbitrage models;

- Political Push: The US weaponizes stablecoins to reinforce financial hegemony.

The future's winning hand lies in: Who can balance compliance (avoiding Tether-style trust crises), profit distribution (breaking monopolies), and multi-chain compatibility (cross-ecosystem liquidity), who will lead the next financial revolution.