Coinbase, the second largest crypto exchange, announced that it is adding Euro Coin (EUROC) stablecoin (EUROC), pegged to the euro and backed by assets in the same currency in accounts managed by the exchange’s issuing partner, Circle, to trading pairs. The announcement of Coinbase coincided with a series of problems with its competitor’s own stablecoin, the Binance exchange. The US Securities and Exchange Commission (SEC) has banned Paxos, the issuer of the stablecoin Binance Coin (BUSD), from issuing new coins, which created a noticeable resonance in the market due to the fact that BUSD was one of the three largest stablecoins, the rate of which is pegged to the price of the US dollar. dollar. In a number of publications and interviews with business publications, both the head of Binance, Changpeng Zhao, and other representatives of the largest crypto exchange, hastened to report that what was happening led to the final break in relations with Paxos, BUSD itself should be taken exclusively as its product, and the exchange is already looking for a replacement for “its own “stablecoin among those on the market. In an interview, Zhao emphasized that “the landscape of the stablecoin market is changing” and that he is also looking at stablecoins backed by currencies other than the dollar.
Speaking to Forbes reporters, Binance Chief Strategist Patrick Hillmann has already spoken in plain text about the impending death of the BUSD stablecoin, which, according to him, turned out to be “virtually destroyed by American regulators.” Hillmann also revealed that several private and public organizations have expressed interest in working with Binance on a similar initiative. Without revealing details, he hinted that there are “very interesting proposals, especially in Europe and the Middle East.” Such a scenario looks complicated in the current market conditions. Today, almost all known stablecoins are still pegged to the US dollar. The largest “non-dollar” stablecoin is Euro Tether (EURT) with a market capitalization of $218 million, which is much lower than that of the same BUSD, whose capitalization exceeds $11 billion even after the issuance ban and the massive outflow of billions of dollars from the asset.
Against the backdrop of the problems of dollar stablecoins, stablecoins pegged to other currencies can take “some significant market share,” said Konstantinas Sizovas, CFO of the ASTL investment project. From the latest actions of US regulators, it is clear that they are determined to show private companies issuing dollar-pegged stablecoins that they are obliged to comply with their rules in one way or another, the expert notes. “While the crypto market was small and isolated from the main financial system, it did not pose a serious threat to financial stability. But as it grows and players from the traditional financial world come to it, the risks increase, and US regulators try to contain these risks. Meticulous regulation is unlikely stablecoin issuers will try to find other currencies to peg their coins in order to stay in the cage, but also somehow avoid the control of US regulators,” says Konstantinas Sizovas. In his opinion, the situation as a whole resembles the world of traditional currencies, where the US dollar is similarly dominated, but its “European competitors” are present in the market “and doing well.” Returning to the crypto market, Konstantinas Sizovas notes that the US is now the main market for crypto assets, and it needs dollars “or its digital counterparts.”
The spread of stablecoins pegged to other currencies depends on two factors: the demand for these currencies from market participants and the reaction of regulators to such assets. After the precedent with dollar stablecoins and the SEC, this may happen in other cases. For example, the European Central Bank may oppose the EUROC stablecoin if it bears the risk of the financial stability of the region, the expert suggests.
As for those currencies that can “grow their stablecloins”, their list is rather small, and similar to the assets of the FOREX market, popular in terms of trading volumes, Sizovas notes, citing the euro, pound, Japanese yen and Swiss franc among examples. With all this, in his opinion, it is now obvious that active stablecoins pegged to the dollar are quite enough for the participants of the crypto market, and there is no serious need for others yet.
Coinbase, the second largest crypto exchange, announced that it is adding Euro Coin (EUROC) stablecoin (EUROC), pegged to the euro and backed by assets in the same currency in accounts managed by the exchange’s issuing partner, Circle, to trading pairs. The announcement of Coinbase coincided with a series of problems with its competitor’s own stablecoin, the Binance exchange. The US Securities and Exchange Commission (SEC) has banned Paxos, the issuer of the stablecoin Binance Coin (BUSD), from issuing new coins, which created a noticeable resonance in the market due to the fact that BUSD was one of the three largest stablecoins, the rate of which is pegged to the price of the US dollar. dollar. In a number of publications and interviews with business publications, both the head of Binance, Changpeng Zhao, and other representatives of the largest crypto exchange, hastened to report that what was happening led to the final break in relations with Paxos, BUSD itself should be taken exclusively as its product, and the exchange is already looking for a replacement for “its own “stablecoin among those on the market. In an interview, Zhao emphasized that “the landscape of the stablecoin market is changing” and that he is also looking at stablecoins backed by currencies other than the dollar.
Speaking to Forbes reporters, Binance Chief Strategist Patrick Hillmann has already spoken in plain text about the impending death of the BUSD stablecoin, which, according to him, turned out to be “virtually destroyed by American regulators.” Hillmann also revealed that several private and public organizations have expressed interest in working with Binance on a similar initiative. Without revealing details, he hinted that there are “very interesting proposals, especially in Europe and the Middle East.” Such a scenario looks complicated in the current market conditions. Today, almost all known stablecoins are still pegged to the US dollar. The largest “non-dollar” stablecoin is Euro Tether (EURT) with a market capitalization of $218 million, which is much lower than that of the same BUSD, whose capitalization exceeds $11 billion even after the issuance ban and the massive outflow of billions of dollars from the asset.
Against the backdrop of the problems of dollar stablecoins, stablecoins pegged to other currencies can take “some significant market share,” said Konstantinas Sizovas, CFO of the ASTL investment project. From the latest actions of US regulators, it is clear that they are determined to show private companies issuing dollar-pegged stablecoins that they are obliged to comply with their rules in one way or another, the expert notes. “While the crypto market was small and isolated from the main financial system, it did not pose a serious threat to financial stability. But as it grows and players from the traditional financial world come to it, the risks increase, and US regulators try to contain these risks. Meticulous regulation is unlikely stablecoin issuers will try to find other currencies to peg their coins in order to stay in the cage, but also somehow avoid the control of US regulators,” says Konstantinas Sizovas. In his opinion, the situation as a whole resembles the world of traditional currencies, where the US dollar is similarly dominated, but its “European competitors” are present in the market “and doing well.” Returning to the crypto market, Konstantinas Sizovas notes that the US is now the main market for crypto assets, and it needs dollars “or its digital counterparts.”
The spread of stablecoins pegged to other currencies depends on two factors: the demand for these currencies from market participants and the reaction of regulators to such assets. After the precedent with dollar stablecoins and the SEC, this may happen in other cases. For example, the European Central Bank may oppose the EUROC stablecoin if it bears the risk of the financial stability of the region, the expert suggests.
As for those currencies that can “grow their stablecloins”, their list is rather small, and similar to the assets of the FOREX market, popular in terms of trading volumes, Sizovas notes, citing the euro, pound, Japanese yen and Swiss franc among examples. With all this, in his opinion, it is now obvious that active stablecoins pegged to the dollar are quite enough for the participants of the crypto market, and there is no serious need for others yet.
