“Digital Dollar” Alternative Stablecoin Regulation XBIT Cryptocurrency Wallet May Create New Support for the US Dollar

Standard Chartered Bank latest research report points out that if US President Trump signs the brewing stablecoin regulatory bill this summer, the US financial market may usher in a structural change. The bank chief strategist Geoff Kendrick predicted in the report that the scale of stablecoin assets will surge from the current US$230 billion to US$2 trillion within four years due to the implementation of the regulatory framework, of which about US$1.6 trillion of new funds will flow into the short term US Treasury market. The XBIT report believes that this chain reaction will not only reshape the US dollar liquidity pattern, but is also likely to become a key variable in maintaining the global dominance of the US dollar.

Twitter : @XBITDEX

Unlike volatile cryptocurrencies such as Bitcoin, stablecoins maintain a 1:1 value anchor by anchoring to fiat currencies or asset portfolios. Their original design intention is to solve the high volatility pain point of the cryptocurrency market. Among the stablecoins currently circulating in the market, Tether (USDT) and USD Coin (USDC) account for more than 90% of the market share, and their reserve assets generally account for more than 50% of short-term U.S. Treasury bonds. XBIT (dex Exchange) Strategists believe that this “quasi-money fund” operating model makes stablecoins essentially a special bridge connecting the crypto market and the sovereign credit system.

It is worth noting that the stablecoin market has shown an exponential expansion trend in recent years. According to XBIT statistics, the total market value of stablecoins increased by 47% in 2023. Although the growth rate has slowed down this year, it still maintains an increase of 11%. Behind this growth, there is not only the demand for cryptocurrency exchanges as a trading medium, but also reflects the growing collateral allocation needs of institutional investors in the field of decentralized finance (DeFi).

Twitter : @XBITDEX

The current regulatory framework for stablecoins in the United States is still in a gray area, and the game in Congress over the Stablecoin Trust Act has lasted for 18 months. The core of the regulatory plan proposed by the Trump administration is to require stablecoin issuers to hold 100% reserves and to disclose the details of reserve assets. XBIT believes that this move will eliminate market concerns and attract trillions of dollars of institutional funds to enter the market.

“Regulatory certification is equivalent to issuing a ‘credit license’ to stablecoins.” XBIT (dex Exchange) analysts pointed out that referring to the growth trajectory of money market funds after they were included in the regulation in 2016, the stablecoin market may enter a period of rapid development. According to its model, at least 75% of the $2 trillion in stablecoin assets will exist in the form of short-term U.S. Treasury bonds, which means that the Treasury will receive more than $100 billion in incremental funds each year, effectively alleviating the pressure of debt rollover.

Against the backdrop of the pressure on the US dollar index, the potential expansion of stablecoins has triggered deep thinking about the geo-economic landscape. Data from the Bank for International Settlements (BIS) show that the share of the U.S. dollar in global foreign exchange reserves has fallen to 59%, but the 100% dollar-anchored nature of the stablecoin market is building a new “digital reserve system.” When stablecoins such as Tether penetrate into cross-border payments, commodity settlements and other fields, they actually form a secondary expansion of the “shadow dollar.”

Twitter : @XBITDEX

This effect is particularly significant in emerging markets. The XBIT case shows that 35% of its cross-border settlements have adopted USDC. This dollar-based transaction that bypasses the traditional SWIFT system has instead strengthened the settlement network effect of the US dollar. XBIT (dex Exchange) supports the management of a variety of crypto assets, including Bitcoin, Ethereum, DeFi tokens, and NFTs. This allows high-net-worth investors to manage diversified assets on the same platform without having to spread them across multiple platforms, improving management efficiency. And they can enjoy multi-signature technology and insurance protection. In this way, investors can not only avoid hacker intrusions, but also receive insurance compensation in extreme cases.

Disclaimer: The information provided in this press release is not a solicitation for investment, nor is it intended as investment advice, financial advice, or trading advice. It is strongly recommended you practice due diligence, including consultation with a professional financial advisor, before investing in or trading cryptocurrency and securities.