Potential Impact of Stablecoins on the Financial System

Stablecoins are a type of cryptocurrency that is pegged to specific assets, serving as a bridge between decentralized finance and traditional finance. Recently, the United States and Hong Kong successively passed stablecoin regulatory bills, marking the formal establishment of a stablecoin regulatory framework in some major regions around the world. This brings development opportunities for decentralized finance while also having new impacts on the global financial system.

Establishment of Stablecoin Regulatory Framework

Recently, the stablecoin bill passed by the United States and Hong Kong has filled the regulatory gap and is an important step for cryptocurrencies to integrate into the mainstream financial system. The bill mainly formulates regulations regarding the transparency of reserve assets, liquidity management, and consumer protection, referencing the regulatory requirements of traditional financial institutions, but with stricter liquidity management. The regulatory positioning of stablecoins is "on-chain cash" rather than "on-chain deposits."

The Scale and Impact of Stablecoins

By May 2025, the market value of mainstream stablecoins is approximately 230 billion USD, which is still relatively small compared to the size of mainstream financial systems. However, in terms of transaction volume, the annual transaction volume of mainstream stablecoins has exceeded that of Visa and Mastercard, demonstrating their importance as a payment tool. With the improvement of regulatory frameworks, stablecoins are expected to deepen their integration with traditional finance.

Potential Impact on the Financial System

1. Improve the efficiency of international payments: stablecoins can reduce the costs and time of cross-border payments, but they also face challenges such as regulatory compliance.

2. Impact on Money Creation: Full reserve requirements limit the credit expansion capabilities of stablecoin issuing institutions, theoretically not directly affecting the money supply.

3. Impact on bank deposits: Stablecoins may lead to deposit outflows, but the current scale of impact is limited. In the long term, attention should be paid to the risk of development speed exceeding expectations.

4. Assuming government debt: stablecoin issuers have become important buyers of US debt, but mainly affect short-term debt.

5. Impact on Financial Markets: Affecting the stock market through channels such as emotional transmission and related assets.

6. Impact on the international monetary order: stablecoins may strengthen the status of the US dollar, or they may serve as a bridge for diversification.

7. Insights on the Internationalization of Currency: It can provide new pathways for the internationalization of non-US dollar currencies.

Risk Warning

The development of the stablecoin industry still presents uncertainties, and the impact on the traditional financial system may exceed expectations. There is also uncertainty regarding the implementation of regulatory policies. In the future, it is necessary to continuously pay attention to industry development trends and policy changes.