In recent months, the United States has intensified its efforts to promote dollar-pegged stablecoins as a means to preserve the dollar's status as a global reserve currency. At the same time, a growing resistance can be observed on the global stage.
US Focus on Dollar-Pegged Stablecoins
According to a new report from digital asset bank Sygnum, the US administration views dollar-pegged stablecoins as a tool to restore trust in the dollar. In this context, the administration is encouraging the growth of the stablecoin market and urging Congress to pass related legislation.
Global Response to Dollar-Pegged Stablecoins
Amid US initiatives, resistance is growing. Italy’s finance minister warned that dollar-pegged stablecoins could pose a greater threat than tariffs. Meanwhile, demand for stablecoins not pegged to the US dollar is on the rise, despite their limited liquidity.
Demand from Developing Countries
The Sygnum report highlights that demand for US dollars is coming from retail in developing countries that are facing rising inflation and depreciating local currencies. There is a consensus that dollar-pegged stablecoins could satisfy this demand and help restore the dollar's former status.
With increasing pressure both domestically and internationally, the future of dollar-pegged stablecoins and their role in the market remains uncertain and requires ongoing observation.
