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Stablecoins are gaining traction, but they still only pay for a small fraction of global online commerce transactions — and stablecoins pegged to currencies besides the United States dollar are too scarce, according to a report published Nov. 27.
Cryptocurrencies, including stablecoins, “account for just 0.2% of global e-commerce transaction value,” according to the <a data-ct-non-breakable="null" href="https://www.quinlanandassociates.com/from-digital-currency-to-legal-tender/" rel="nofollow noopener" target="_blank" text="null" title="https://www.quinlanandassociates.com/from-digital-currency-to-legal-tender/">report</a>, which was created by strategy consultancy Quinlan &amp; Associates and blockchain developer IDA.
“Paired with blockchain-enabled favourable features such as programmability, stablecoins can offer cost efficiency, enhanced transparency, 24/7 availability, and faster processing that traditional financial systems simply can’t match,” Lawrence Chu, IDA’s co-founder and CEO, said in a statement.
Despite this potential, stablecoin “usage remains largely within the Web3 ecosystem,” the report said, citing regulatory uncertainty and limited non-USD stablecoin options as significant barriers. 
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 <img alt="Non-USD stablecoins can spur adoption: Report" src="https://s3.cointelegraph.com/uploads/2024-11/01936eab-6aa0-7aa8-898b-1520aec687af" title="">
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 Source: <a data-ct-non-breakable="null" href="https://www.quinlanandassociates.com/from-digital-currency-to-legal-tender/" rel="nofollow noopener" target="_blank" text="null" title="https://www.quinlanandassociates.com/from-digital-currency-to-legal-tender/">Quinlan &amp; Associates, IDA</a>
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Related: <a data-ct-non-breakable="null" href="https://cointelegraph.com/news/stablecoins-boosting-demand-us-treasury-bills" rel="" target="_self" text="null" title="https://cointelegraph.com/news/stablecoins-boosting-demand-us-treasury-bills">Stablecoins boosting demand for US T-bills: Treasury Dept</a>
“This reluctance is largely driven by regulatory uncertainty, with 81% of merchants citing it as the primary barrier to accepting digital assets like stablecoin as a mainstream payment option,” Benjamin Quinlan, Quinlan &amp; Associates’s CEO, said in a statement.
Additionally, “with 83% of countries worldwide not using the USD as their official or secondary currency and ~40% of international payments being conducted in non-USD currencies, there is a pressing need for non-USD pegged stablecoins,” the report said.
Stablecoins collectively represent $200 billion in total market capitalization, virtually all of which comprises stablecoins pegged to USD, according to data from CoinMarketCap. 
Tether’s USDt (<a data-ct-non-breakable="null" href="https://cointelegraph.com/tether-price-index" rel="" target="_self" text="null" title="https://cointelegraph.com/tether-price-index">USDT</a>) and USD Coin (<a data-ct-non-breakable="null" href="https://cointelegraph.com/usdc-price-index" rel="" target="_self" text="null" title="https://cointelegraph.com/usdc-price-index">USDC</a>) are the most popular stablecoins, with market caps of around $130 billion and $40 billion, respectively, the data shows. 
IDA plans to launch a stablecoin pegged to the Hong Kong dollar to support “payments between Hong Kong and global markets,” Quinlan and IDA said.
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 <img alt="Non-USD stablecoins can spur adoption: Report" src="https://s3.cointelegraph.com/uploads/2024-11/01936ea6-cdae-7b99-be2f-cb28fc48a934" title="">
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 Source: <a data-ct-non-breakable="null" href="https://coinmarketcap.com/view/stablecoin/" rel="nofollow noopener" target="_blank" text="null" title="https://coinmarketcap.com/view/stablecoin/">CoinMarketCap</a>
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Stablecoins seem to be <a data-ct-non-breakable="null" href="https://cointelegraph.com/news/stablecoins-boosting-demand-us-treasury-bills" rel="" target="_self" text="null" title="https://cointelegraph.com/news/stablecoins-boosting-demand-us-treasury-bills">increasing demand</a> for short-term US government bonds known as Treasury bills, according to the US Department of the Treasury.
“[B]ecause most stablecoin collateral reportedly consists of either Treasury bills or Treasury-backed repurchase agreement transactions, the growth in stablecoins has likely resulted in a modest increase in demand for short-dated Treasury securities,” according to Treasury Department meeting minutes released on Oct. 29.
On Nov. 20, former US Senator Pat Toomey told Cointelegraph that lawmakers <a data-ct-non-breakable="null" href="https://cointelegraph.com/news/stablecoin-bill-faces-challenges-former-senator-pat-toomey" rel="" target="_self" text="null" title="https://cointelegraph.com/news/stablecoin-bill-faces-challenges-former-senator-pat-toomey">will likely advance stablecoin regulations starting in 2025</a>.
Toomey believes there are several unanswered questions regarding stablecoin issuers that must be resolved first, including reserve requirements, insurance on bank deposits and regulatory jurisdiction.
Several pieces of <a data-ct-non-breakable="null" href="https://cointelegraph.com/news/crypto-voters-guide-key-congressional-legislation-2024-election" rel="" target="_self" text="null" title="https://cointelegraph.com/news/crypto-voters-guide-key-congressional-legislation-2024-election">key crypto legislation</a> will be considered in the upcoming congressional term, <a data-ct-non-breakable="null" href="https://www.hagerty.senate.gov/wp-content/uploads/2024/10/Stablecoin-Draft-Text.pdf" rel="nofollow noopener" target="_blank" text="null" title="https://www.hagerty.senate.gov/wp-content/uploads/2024/10/Stablecoin-Draft-Text.pdf">including</a> Senator Bill Hagerty’s Clarity for Payment Stablecoins Act. 
Magazine: <a data-ct-non-breakable="null" href="https://cointelegraph.com/magazine/how-to-upset-cardanos-charles-hoskinson-by-quoting-him-accurately/" rel="" target="_self" text="null" title="https://cointelegraph.com/magazine/how-to-upset-cardanos-charles-hoskinson-by-quoting-him-accurately/">How to upset Cardano’s Charles Hoskinson by quoting him accurately</a>

Non-USD stablecoins can spur adoption: Report

Cointelegraph

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