Update on 'Stablecoin' Trends in 2024 and Usage Scenarios from Major Companies
Stablecoin continues to be one of the more interesting trends in the crypto world, especially in 2024. The market value of Stablecoin has been continuously increasing for 10 consecutive months and currently holding a market share of 6.93%, due to various factors and the usual volatility of the crypto market. Stablecoin, with its stable value close to fiat currency, is becoming increasingly popular among investors and users.
The Leading Trend of Stablecoins in 2024:
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- Continuous Growth: The market capitalization of stablecoins continues to expand with the entry of new players into the market.
- Diversity of Collateral Assets: In addition to the primary use of fiat currencies through tokenization, stablecoins are increasingly backed by other assets such as gold, stocks and other digital assets.
- Adoption in Payment Systems: Stablecoins are being increasingly used for payments, especially in cross-border transactions, which helps reduce fees and increase speed.
- Stricter Regulations: Regulatory bodies around the world are paying more attention to stablecoins, and more regulations are being issued to govern their operations.
Reviewing the Benefits of Stablecoins
- Transparency: The blockchain used to create stablecoins allows for transparent verification of the source of funds.
- Stability: Their value being tied to fiat currencies helps reduce the risk from the volatility of the crypto market.
- Speed of Transactions: Transactions with stablecoins are faster than bank transfers.
- Low Fees: Transactions with stablecoins usually have lower fees than traditional money transfers.
Use Case Examples from Large Companies
In 2024, the Stablecoin trend is developing rapidly, with diverse applications from major companies worldwide. Here are some examples:
- Visa is pushing forward into the blockchain space by launching a new program in collaboration with Solana. Visa has acquired Worldpay and Nuvei to support payments with digital currencies (e.g. stablecoins) like USDC. This project aims to enhance the speed of international payments, making it easier for businesses to send or receive money from Visa's treasury. (Source: Bitcoinist)
- Circle, the issuer of USDC, has launched a “Virtual stablecoin card” that can be used to purchase goods through the Mastercard network. Currently available in Australia, there are plans to expand to Europe and Asia. Circle also emphasizes the development of stablecoin applications for Web3 and smart contracts, which will help in creating applications that use smart contracts to increase efficiency in the digital finance sector. Circle has also partnered with other companies to expand the use of USDC in payment systems and digital finance. (Source: American Banker)
- PayPal has launched the PayPal USD (PYUSD) coin to facilitate payments through the PayPal platform. This coin is backed by the US dollar and cash equivalents. It is being used in the payment system for users on BitPay, Xsolla, and Zeni.com. Additionally, it has the potential to attract PayPal's large user base and expand to non-crypto users as well. (Source: American Banker)
- Ripple has partnered with the government of Palau to issue a stablecoin called PSC. This stablecoin has been successfully used in a pilot project at local stores. Ripple believes that this concept can be expanded to other economies, especially in countries facing high inflation. (Source: Ripple)
- Tether (USDT) remains the stablecoin with the highest market capitalization and is widely used in crypto trading. In 2024, Tether (USDT) has a market capitalization of approximately 116 billion US dollars, accounting for about 69.6% of the total stablecoin market. (Source: CoinGecko, CoinMarketCap)
- Standard Chartered's Zodia Markets is a platform that enables organizations to make fast, cost-effective, and transparent cross-border payments using stablecoins as a medium of exchange.
- Nomura Holdings, Laser Digital, and GMO Internet Group have collaborated to explore the issuance of stablecoins pegged to the Japanese yen (JPY) and the US dollar (USD). The objective is to develop a Stablecoin-as-a-Service system that will support companies in issuing stablecoins in compliance with legal requirements, including the integration of blockchain technology and back-end transaction management. This project will also explore the mechanisms for issuance, exchange and circulation of stablecoins.
In addition, many leading technology companies are starting to explore the possibility of using stablecoins in their products and services, such as using stablecoins as an in-platform currency for games or for paying for various services.
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Future Predictions for Stablecoins
- Increased demand and adoption, due to their convenience and stability.
- Increase in diverse collateral assets to mitigate risks.
- Establish clearer regulations to foster long-term confidence.
- Emergence of local or regional stablecoins to cater to the needs of users in different countries.
Conclusion
Stablecoins are playing a crucial role in the development of the digital financial system and are likely to continue growing in the future. The adoption of stablecoins in various businesses will help increase efficiency and convenience in financial transactions.
However, the crypto market is highly volatile. The information mentioned above is just a current overview and may change in the future.
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Source:
https://blockworks.co/news/2024-stablecoins-crypto-volatility
https://www.nomuraholdings.com/news/nr/holdings/20240527/20240527.html