Frank Chaparro: Stablecoins May Further Grow By Promoting More Inclusive Payments and Financial Systems

The Block’s head of news, Frank Chaparro, tweeted that the Federal Reserve’s 26-page white paper on stablecoins “has seen explosive growth in dollar-pegged stablecoins circulating on public blockchains over the past year, ending September 2021. In January, the total circulating supply was close to $130 billion, an increase of more than 500% from a year ago.

If stablecoins become widely adopted across the financial system, they could have a significant impact on the balance sheets of financial institutions. Regulators…are particularly concerned about the potential of stablecoins to disrupt bank-led credit intermediation.

All in all, the current use of stablecoins is primarily driven by cryptocurrency transactions, limited peer-to-peer payments, and DeFi. Going forward, stablecoins are likely to grow further by facilitating a more inclusive payment and financial system.”

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