Economic Daily published an article titled "Risks and Challenges Coexist in the Global Stablecoin Market"

The global stablecoin market has risks and challenges: dual drive of regulation and growth The Economic Daily recently published an article entitled "Risks and Challenges Coexist in the Global Stablecoin Market". The article pointed out that stablecoins, as an important part of the crypto market, are relatively stable in price because they are linked to stable assets such as legal tender, and can effectively reduce the volatility of the crypto market. Main content summary: -The global stablecoin market is growing rapidly: In the past four years, the quarterly transfer volume of global stablecoins has increased 17 times, reaching 4 trillion US dollars in the second quarter of this year. On July 17, 2024, the total transaction volume of the stablecoin market reached 87 billion US dollars, of which Tether (USDT) accounted for 83.3%. -Reasons for growth: Stablecoins are linked to legal tender, have stable prices, can anchor the value of multiple cryptocurrencies, and reduce market volatility. The U.S. Securities and Exchange Commission approved the listing of Bitcoin spot ETFs and Ethereum spot ETFs, increasing the demand for stablecoins in arbitrage, risk control, etc. Stablecoins also have functions such as dealing with currency depreciation, risk hedging, and remittance transfers. -Global regulatory differences: Different countries have different regulatory policies on stablecoins, which affects cross-border flows and use. In March 2024, the Hong Kong Monetary Authority launched a "sandbox" for stablecoin issuers. In June, the UAE issued stablecoin supervision and licensing regulations. -The importance of regulation: A clear regulatory framework enhances investor trust and reduces potential risks. Regulation ensures that reserves are adequate and transparent, and prevents market manipulation and fraud. -Challenges and risks: The lack of a unified global regulatory environment affects cross-border flows; market prices are still affected by changes in supply and demand, market sentiment and macroeconomic factors; stablecoins require a high degree of transparency and trust, and technical security is also crucial. -Future Outlook: Stablecoins are an important tool to maintain the crypto market, and changes in demand and internal competition affect their development. In the future, the market will develop in a differentiated manner, and whether various currencies can operate in an orderly manner remains to be seen. -Expert opinion: Zhao Wei, senior researcher at the OKX Research Institute, a digital asset trading platform, and Yu Jianing, co-chairman of the Blockchain Special Committee of the China Communications Industry Association, emphasized that stablecoins play an important role in the crypto market and the international payment system, but also face challenges such as transparency, operational risks and legal risks.