Alina Khay

Alina Khay

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Alina Khay
Alina Khay
How Stablecoins Are Fuelling the Global Shift to Dollarisation

How Stablecoins Are Fuelling the Global Shift to Dollarisation

Stablecoins have quietly become a dominant force in the cryptocurrency market, blending the flexibility of digital assets with the stability of traditional fiat currencies.

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Alina Khay
Feb 17, 2025
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Alina Khay
Alina Khay
How Stablecoins Are Fuelling the Global Shift to Dollarisation
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Stablecoins have quietly become a dominant force in the cryptocurrency market, blending the flexibility of digital assets with the stability of traditional fiat currencies. Unlike volatile cryptocurrencies, stablecoins maintain a predictable value, typically pegged 1:1 to fiat currencies such as the U.S. dollar. With adoption skyrocketing—usage is up 84% since August 2023, reaching a peak of $224 billion—stablecoins are reshaping global finance in ways that extend far beyond the crypto ecosystem. One of the most profound implications is their role in accelerating the dollarization of economies, especially in emerging markets. But why are stablecoins fueling this shift, and what are the broader economic consequences?

The Dollarization Effect

It is striking that nearly 99% of stablecoins, measured by market capitalization, are denominated in U.S. dollars—an astonishingly high share compared to traditional international trade and finance. This suggests that if monetary institutions were bu…

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