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Which Countries are Leading the Global Stablecoin Race, and How?

In recent years, digital currencies have been all the rave. However, the idea that digital assets are exclusively some form of currency is slowly falling by the wayside as different use cases are emerging and being rapidly adopted. This May, The Fintech Times is looking to showcase some of these new methods and explore how the digital asset ecosystem is evolving.

As we reach the final days of the month, we begin to bring our focus on digital assets to a close, by focusing on another technological innovation gaining momentum: the stablecoin.

This cryptocurrency is designed to have a more stable price, than its famously volatile counterparts – typically through being pegged to a commodity or currency or having its supply regulated by an algorithm.

Recently, it has become clear that many big tech firms and countries are boarding the stablecoin train, and are looking to bolster adoption among consumers. But which countries are leading the stablecoin race, and how have they achieved this? To find out, we reached out to industry leaders.

Global stablecoin competition

Jorge Lesmes, senior director and client partner at IT services provider NTT DATA, breaks down a number of global competitors vying to gain an advantage regarding stablecoin adoption:

Jorge Lesmes, senior director and client partner, banking at NTT DATA UK&I, stablecoin race
Jorge Lesmes, senior director and client partner at NTT DATA

“As far as leadership in the stablecoin sector, many countries including the US, China, Switzerland, and Nigeria have been at the forefront of the currency’s regulation and adoption.

“As the US already has a robust financial infrastructure in place and is established as a global tech leader, it’s in the position to facilitate the development and adoption of stablecoins, with Tether (USDT-USD), MakerDAO (DAI), and USD Coin (USDC) currently falling under its crypto umbrella.

“China has come out with First Digital USD (FDUSD), backed by the US. and noted as one of the world’s largest stablecoins. Switzerland is excelling in the stablecoin regulatory environment, combining tech innovation and regulatory framework to ensure stablecoins are created and adopted securely.

“Nigeria, and a few other African countries, are seeing an increased interest in and adoption of stablecoins. Nigeria has pioneered the launch of its own CBDC, the eNaira​.

“The UK isn’t far behind but, if it’s going to follow in the steps of countries who have prioritised regulation and ensured stability, it will need to continue taking steps to foster solid public trust in stablecoin. With the UK Economic Secretary announcing potential new regulation around stablecoins in coming weeks, this trust may start building sooner than later.”

Taking the lead

Kate Leaman, chief market analyst at AvaTrade, also appears to agree with Lesmes, and offers her take on why the US and Switzerland specifically have positioned themselves better than most:

Kate Leaman, chief market analyst at AvaTrade, stablecoin race
Kate Leaman, chief market analyst at AvaTrade

“Countries like the US and Switzerland are leading in the stablecoin space, primarily due to their advanced financial sectors and open regulatory environments that encourage innovation in digital currencies.

“The US, for example, is home to some of the largest stablecoin projects, such as Tether and USD Coin, which are integrated into global cryptocurrency markets.

“Switzerland is known for its crypto-friendly regulations and has become a hub for cryptocurrency and blockchain technology.

“These countries provide a supportive ecosystem that attracts developers and companies looking to advance stablecoin technology.”

Europe vying for attention
Sofian Berrahal, chief business officer at Nexpay
Sofian Berrahal, chief business officer at Nexpay

For Sofian Berrahal, chief business officer at Nexpay, Europe cannot be forgotten about when it comes to stablecoins, thanks to regulatory efforts:

“Europe is the centre of attention in the stablecoin race thanks to MICA’s plans to regulate stablecoin issuers and enable hundreds of financial institutions to issue their own stablecoins.

“Stablecoins are increasingly popular as a means of payment, which attracts more industries and increases adoption. All of this is leading us to the major innovation of the future: a total integration of traditional finance and stablecoins.”

Common traits

All of the countries leading the way have something in common, according to Pierre Person, CEO and co-founder of stablecoin DeFi protocol Usual Labs.

Pierre Person, CEO and co-founder of stablecoin DeFi protocol Usual Labs
Pierre Person, CEO and co-founder of Usual Labs

“On the global stage, countries like the US, France, Singapore, the Cayman Islands, and Switzerland are at the forefront of the RWA race.

“These nations share a common trait: robust regulatory and legal frameworks that support the compliant issuance of on-chain assets, including bonds.

“Their progressive regulatory environments not only foster innovation but also provide a secure and legally compliant foundation for the development and expansion of stablecoin initiatives.

“This proactive stance in regulation and legal support makes these countries pivotal players in the evolving landscape of stablecoins, setting benchmarks for others to follow.”

US stablecoin dominance

Ultimately, it appears the general consensus is that the US is leading the stablecoin race, as Zach Burks, CEO of Mintable, an NFT marketplace, explains how it has achieved this position.

Zach Burks, CEO and founder of Mintable
Zach Burks, CEO and founder of Mintable

“The US is the dominant stablecoin country, purely given the importance of the US dollar compared to other FIAT currencies. However, with regulation ramping up globally other countries’ stablecoins are gaining in prominence. This includes Japan, following its stablecoin legislation coming into force last year. Whilst well legislated, Japan’s crypto stringency has put the country in a unique position whereby it is moving forward at a sluggish, institutional pace.

“The US is leading the race in volume, purely through its cultural adoption of crypto, whereas Japan is leading the way in regulation. If we combine the two, we will have a runway for success. One difficult hurdle currently, is that crypto across the globe is evolving at different paces, due to most financial institutions sitting under the SEC’s governance, we will have to wait for the US to jump before the world can follow suit.”

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