Stablecoins (USDC, USDT) is a ‘global dollar demand engine’ or a 2008-style ‘Liquidity Crunch’?
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While entrepreneurs have been fixed to the latest Jerome Powell rate signals, the more consequence of the story can play in Stablecoins.
The sector is about double a year to $ 280 billion, with most of those who give up short -term resources as collateral. That was tied to crypto liquidity directly to the Federal Reserve policy than before, according to OKX Singapore CEO Gracie Lin.
“While the markets are still melting Powell’s latest comments at rates, a more consequence of long-term shifts are happening beyond charts and headlines. It’s in the so-called ‘boring’ stablecoins that we see better signals of long-term prices,” Lin told CoinDesk on a note.
“The next step is to unite -the Stablecoins have built railroads, now they need a single market that delivers liquidity, efficiency and real utility for investors,” Lin continued.
Coinbase analysts project The market could worsen $ 1.2 trillion by 2028, forcing $ 5.3 billion of new Treasury purchases per week. The flowers may marginally lower the yields, but the risk runs upside down: Redemption at the redemption can trigger the forced sale of fees, drainage of liquidity.
The debate went on with a Recent stage of Goldman Sachs exchanges Podcast, in which UC Berkeley’s Barry Eichengreen warned that Stablecoins could copy the money fund panic in 2008.
“When a dollar sharing of money in the market fell to 97 cents in 2008, the chaos exploded, the fears of the Contagion spread, and the government entered to ensure funds,” he said.
Former US Comptroller Brian Brooks fought against the Podcast that the New Genius Act, which requires one-to-a-support of Treasury, reflects national banking reforms that ended during America’s “wildcat banking”.
“The administration is equivalent to salvation,” he said. “Each time a new token is released, another dollar of security security should be purchased.”
This Tug-of-War captures the macro dilemma.
The Coinbase model shows Stablecoins shaving basis points off treasury Ani, Brooks called it a new engine of global dollar demand, and Eichengreen warns a 2008-style liquidity crunch. Meanwhile, Lin argues that the railroads are already – and the question is whether they unite a market that stabilizes the system or fracture with instruments that boost shocks.
Movements in the market
BTC: The BTC is currently trading above $ 111,300. CoinDesk market data shows that the world’s largest digital ownership is trading within a tight intraday range, suggesting integration -with emotion. Markets appear to be careful amid MacRO uncertainty, with investors patiently waiting for additional momentum or directional clues.
Eth: ETH has turned to $ 4,320, showing moderately reversed (+0.6%) Intraday, indicating the investor’s updated interests following recent gains. Broader crypto recovery, especially in altcoins, seems to boost demand.
Gold: The gold recently crossed $ 3,540 an ounce, putting it in a fresh all-time closure of high. The rally is driven by seizing expectations for an upcoming fed rate cut as well as increased uncertainty on US tariffs and political pressure on the Fed. Investors are climbing gold as a safe – haven asset amid these risks.
NIKKEI 225: Nikkei 225 remains stable within its current coverage, reflecting the careful options of investors. The increase complies with a wider “ninja stealth rally” in the same afternoon, driven by strong foreign flow, reform, and transfer of global capital trends to Japan.
