Stablecoin Bill Could Extend Dollar's Global Dominance — Market Talk

The Senate's approval of a bill to regulate stablecoins brings the U.S. closer to extending its global dollar dominance into the digital age, Deutsche Bank strategist Marion Laboure says in a note. If the bill is enacted, dollar-pegged stablecoins could channel non-dollar liquidity into the dollar, she says. Dollar-pegged stablecoins account for most of the stablecoin market. "Regulated U.S. stablecoins may accelerate digital dollarization in economies where stablecoins are increasingly used as a hedge against monetary instability and high inflation." The bill could support dollar domination without needing the banking infrastructure requirements or government control associated with a central bank digital currency, she says. ([email protected])