Stablecoins: Misconceptions and Global Impact Analysis

According to BlockBeats, a recent report by Guotai Haitong Securities Research titled "Stablecoins: How They Reshape Global Currency and Assets" provides an in-depth analysis of the current state and future prospects of the stablecoin market, as well as its impact on major asset classes. The report identifies six common misconceptions about stablecoins, emphasizing that their value is not absolutely stable. The first misconception is that stablecoins have absolute value stability. The report clarifies that stablecoins are essentially credit extensions of pegged assets, subject to technical de-pegging risks and fluctuations in the value of the underlying assets. Therefore, their value is relatively stable rather than absolutely stable. The second misconception is that all fiat currencies can be used to issue stablecoins in large quantities. The development of stablecoins for different fiat currencies depends on the acceptance of the fiat currency itself. Stablecoins backed by the most widely trusted fiat currencies are likely to dominate the market. The third misconception is that U.S. dollar stablecoins weaken the credibility of the dollar. On the contrary, the rapid development of dollar stablecoins enhances the dollar's status by expanding its functionality and usage. However, dollar stablecoins pose a significant challenge to the fiat currencies of other countries, especially those with volatile exchange rates. The fourth misconception is that U.S. dollar stablecoins are a "lifeline" for U.S. Treasury bonds. While the stablecoin market can slightly alleviate the pressure on U.S. short-term debt, the Federal Reserve ultimately controls the short-term debt market. Dollar stablecoins have minimal impact on the long-term debt market. The fifth misconception is that U.S. dollar stablecoins will significantly increase the supply of U.S. dollars. Although stablecoins allow some issuance authority to be transferred from the Federal Reserve to issuing companies, the Federal Reserve remains the primary participant in monetary supply and can regulate overall dollar liquidity. Similar to economies with a currency board, multiple issuing banks exist, but monetary authorities can still adjust the money supply based on market conditions. The sixth misconception is that stablecoins will rapidly advance the Real World Asset (RWA) market. The support of stablecoins for RWA is more evident in the trading aspect, while the development of the RWA market ultimately depends on the quality of underlying assets. Currently, the RWA market is in its early stages, with potential paths focusing on "credit priority" and "liquidity priority."