Stablecoins became famous due to their stabilized nature. However, there is a key ingredient missing from the Stablecoin that has kept the tokens away from the possible boom. Experts seem convinced that universal interoperability is the missing piece of the puzzle that can unlock the potential of stablecoins’ and CBDCs’ to grow as the global digital economy.
Stablecoins are considered the backbone of the digital asset marketplace as the current cap of the market is over $100 billion. On the other hand, governments across the globe are spending all the available resources to launch their own digital currencies in order to match the pace with the crypto marketplace.
The US government is planning to launch its own Central Bank Digital Currency backed by the Stablecoins’. A report published by the U.S President’s Working Group on Financial Markets back in the month of Movement points out the various measures being taken by the relevant authorities to ensure that Stablecoins fall within the government’s regulatory guidelines.
Most recently central bank survey by the Bank for International Settlements (BIS) showed that almost 86% of the world’s central banks are recently quite actively engaged in some way with central bank digital currencies (CBDCs), however, almost the majority of the central banks are have backed their ambition with stablecoins. Out of these central banks, almost 7 of them have officially launched their own digital currencies. Moreover, 17 more banks are in a pilot phase to launch their own digital currencies, according to the Atlantic Council CBDC tracker.
During all this discussion of stablecoins and CBDC’s, blockchain holds integral importance. Like all other cryptocurrencies, stablecoins are also powered by blockchain technology. Blockchain helps stablecoins to support peer-to-peer (P2P) digital transactions. As of this writing, the world is fastly moving on to the blockchain. Blockchain technology is the future of the digital world. Blockchain offers cryptocurrencies the bearer-instrument and final-settlement properties of cash.
What blockchains offer to the digital world is faster transactions, lower settlement costs, cost-effective transaction fees, unparalleled transparency, and increased control for end-users. Blockchain has taken the digital and corporate world by storm. Various distinctive market companies, both public and private, have fostered different divided blockchain networks. To accomplish their full utility, stablecoins should work across a considerable lot of them.
As of this writing, the developers of some of the renowned stablecoins like Dai (DAI), TerraUSD (UST), and USD Coin (USDC) all are using blockchain technologies to support their crypto operations. Moreover, blockchains technologies have also reduced costs and security risks for these platforms. These universal interoperability solutions will also help CBDC and stablecoin developers overcome the costs and security risks associated with one-off builds. With the launch of central bank digital currencies the market cap of stablecoins will rise further.