Stablecoins Could Support Dollar's Dominance — Market Talk

Stablecoins could help the dollar retain its dominance in international payments, Capital Economics economists say in a note. The use of stablecoins pegged to the dollar could boost dollar usage and increase demand for U.S. assets, they say. "Moreover, stablecoins could end up widening the pool of potential investors in U.S. assets." This would offset the stagnation in demand for dollar reserves holdings over the past decade. It would mitigate the reduction of dollar usage where countries such as China and Russia are increasingly using other currencies to settle trade and investment transactions. ([email protected])