BlockBeats News, May 26th, The Wall Street Journal article pointed out that stablecoins are essentially “private money”. Despite the GENIUS Act and the CLARITY Act attempting to promote the compliance of stablecoins, stablecoins may still pose structural risks to the financial system. The article stated that stablecoins aim to combine the stability of the US dollar with the efficiency of blockchain payments, but due to operating on fragmented and privatized infrastructure, they lack the “uniformity” of the traditional dollar system. Although USDT and USDC are pegged to the dollar, their prices can still deviate from $1.

The issuers of stablecoins have a natural incentive to scale up and “pursue yield”, potentially by investing in higher-risk and less liquid assets to increase returns. If the value of the underlying assets decreases, stablecoins may not be able to maintain their peg, leading to user redemptions and market chain reactions. In addition, citing Chainalysis data, the article mentioned that stablecoins account for 84% of illicit crypto activity, including sanctions evasion and money laundering. Currently, stablecoins are primarily used for crypto trading, with less than 1% used for real-world economic transactions.

Stablecoins are replaying the path of the 19th-century American “Free Banking Era” private money experiment. Despite stablecoins becoming a key direction in payment technology evolution, in the future, they may have to, like banks, accept stricter regulation and deeper integration into the central bank system.