Global Race for National Currency-Pegged stablecoins
USD-pegged stablecoins have bolstered the U.S. dollar. Now, other nations are exploring similar strategies to fortify their own currencies through stablecoins.
Global Stablecoin Race: Strengthening National Currencies
USD-pegged stablecoins have bolstered the U.S.dollar. Now, other nations are exploring similar strategies to fortify their own currencies through stablecoins.
The U.S. has encouraged private and public companies to issue stablecoins—blockchain-based money backed by real assets, usually U.S. dollars or Treasury bills. This move, driven by the GENIUS Act, aims to create new growth opportunities for companies while maintaining the dollar’s dominance.
However, this dominance could siphon deposits from local banks in other countries. To counter this, nations like Japan and China are developing their own stablecoins.Japan’s Monex Group plans to launch a yen-pegged stablecoin backed by Japanese government bills. This aims to facilitate cross-border remittances and corporate trades.
China, with its powerful social media platforms like WeChat, is also moving towards a yuan-pegged stablecoin. This could counter the influence of USD-pegged stablecoins in international trade.
The European Union is considering launching a digital euro on public blockchains like Ethereum and Solana. This move aims to compete with the growing dominance of USD-pegged stablecoins.
While these efforts show promise, the adoption of national stablecoins faces challenges. Europe, for instance, lacks platforms like Meta or WeChat to boost adoption.Nonetheless, the global race for stablecoins continues, with each country striving to strengthen its currency in the digital age.
