Stablecoin are a special breed of cryptocurrencies. Their value is pegged to fiat currencies, giving them stability. They are immune to the volatility of prices that other cryptos face. As such, they have quickly become a great way for investors and traders to park their capital. Jeremy Allaire, co-founder and CEO of Circle recently stated that stablecoins are seeing explosive demand.
Circle CEO Says There Is Explosive Demand For Stablecoins
Stablecoin are a special breed of cryptocurrencies. Their value is pegged to fiat currencies, giving them stability. They are immune to the volatility of prices that other cryptos face. As such, they have quickly become a great way for investors and traders to park their capital. Jeremy Allaire, co-founder and CEO of Circle recently stated that stablecoins are seeing explosive demand.
Circle stablecoin
This is heartening news for everyone involved in the crypto industry. It shows that the crypto markets are seeing great inflows of money. This means that more and more people are getting involved, thereby, growing the industry. Even the regulators of the world have taken note of the rise of stablecoin (G20 concerned about about stablecoins). They are quickly discussing ways to regulate them on a global level. All of this bodes well for cryptocurrencies as a whole.
Explosive Demand for Stablecoin
Circle has especially benefited from the explosive demand for stablecoins. They recently pivoted to a new business model centering their stablecoin USDC (USD Coin). Allaire also stated that the demand was mainly coming from normal businesses and for normal business transactions. This is opposite of stablecoins’ historical use of moving money around between exchanges.
This means that people are starting to use stablecoins like USDC for payment purposes. The same purpose that cryptos like bitcoin were designed for. However, other cryptos have wild volatility. This makes it difficult for merchants to integrate them into their business. They just don’t know what the value of the coins might be in the future.
This is not the case with stablecoins. The value is fixed and so they can easily be used like fiat. In fact, they provide the benefits of both cryptocurrencies and fiat currencies. That is why the USDT (USD Tether), the most popular stablecoin ranks the 4th largest crypto by market cap.
Tehter
Allaire also said, “We are getting feedback from Asian market participants that there is more and more demand for USDC from SMEs seeking both the safety and utility of digital dollars.” SMEs stand for small and medium-sized enterprises. This is evident from the fact that new signups have come from payment companies, professional services firms, e-commerce platforms, advertising agencies, etc.
All of this has led to an increase of 700% for Circle. The growth has been in the number of Circle Business Accounts which are used by corporate clients to use USDC.
A New Form of Money?
While the central banks are endlessly printing fiat to battle COVID-19, a new form of money is taking shape. Blockchain technology and cryptocurrencies are experiencing a resurgence. Bitcoin’s halving is around the corner. Fiat money is bound to suffer from hyperinflation soon. All of this sets up the perfect scenario for crypto, especially stablecoin, to overtake as the currencies of choice.
Every huge change in history has come after times of turmoil. The current one may give rise to a new financial system altogether. It will be digital, blockchain-based and the people will be in control. This is exactly the ethos of cryptos.
This is exactly why Satoshi Nakamoto created bitcoin in the first place.
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