America Needs Stablecoins: A Former Comptroller’s Perspective
A former acting Comptroller of the Currency, Brian P. Brooks, has emphasized the importance of stablecoins in America and called for their regulation by Congress. He believes that stablecoins are crucial in the face of de-dollarization trends in Asia and Latin America.
Key Points:
- Stablecoins can help slow down de-dollarization by providing an alternative to local currencies suffering from inflation and devaluation.
- They are seen as tools of American soft power in a world questioning the role of the dollar.
- Major economies are settling trades in local currencies, reducing the demand for the dollar.
- BRICS countries are reportedly working on their own alternative digital currency.
- Patrick McHenry’s Payment Stablecoins Act would establish federal oversight for stablecoins, but bipartisan support unexpectedly diminished.
The Dominance of Tether and the Decline of Circle:
- Tether (USDT) currently dominates the stablecoin market with a market share of 66.5% and a supply of $83.5 billion.
- Circle’s USDC, the second largest stablecoin, represents only 21% of the market with a supply of $26.2 billion.
- Decentralized DAI holds a market share of 3.2% with a circulating supply of $4 billion.
Hot Take:
The increasing global de-dollarization trend necessitates the regulation and adoption of stablecoins in America. Stablecoins can not only help strengthen the dollar but also empower ordinary citizens abroad. However, regulatory clarity and bipartisan support are necessary to ensure their successful integration into the financial ecosystem.
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