- Stablecoin legislation and digitizing the US dollar have become crucial in countering global de-dollarization.
- The Circle CEO, Jeremy Allaire, has urged Congress and the Federal Reserve to act immediately.
- Integrating the digital dollar into core systems has been deemed essential for the US to remain competitive.
According to Jeremy Allaire, the CEO of Circle, stablecoin legislation and digitization of the U.S. dollar are crucial to counteract the “very active de-dollarization taking place” globally.
At the Consensus 2023 conference on April 26, Allaire emphasized the urgent need for Congress and the Federal Reserve to prevent alternative currencies and payment systems from undermining the dollar’s dominance.
Circle CEO Sees Demand for Digital Dollars Globally
Allaire pointed out that the recent U.S. banking crisis has triggered significant reactions to U.S. risks in the banking system and government and geopolitical pressures in many parts of the world.
As a result, the demand for alternative payment systems is accelerating worldwide. Therefore, Allaire stressed that the U.S. must act now to remain “competitive” and “safe” in the internet era.
Allaire called on the U.S. to establish stablecoin legislation and for the Federal Reserve to integrate the digital dollar into its core systems to meet the high demand for digital dollars like USD Coin (USDC) globally.
Allaire believes that the digital dollar can serve as an efficient medium of exchange for various types of international transactions, and it is highly sought after in emerging markets.
Circle CEO: “Giant Missed Opportunity” for U.S. Without Digital Dollars
Allaire warned that if the U.S. government fails to act, it will be a “giant missed opportunity” for the country. He stressed that the demand for digital dollars is worldwide and that Circle has taken some responsibility into its own hands by launching USDC on Cross-Chain Transfer Protocol.
According to Allaire, the new solution is the “most important new piece of blockchain infrastructure” since Circle began issuing USDC in 2017. The call for action comes as the Chinese yuan surpassed the dollar for cross-border transactions in China in March, as reported by Reuters.
On the Flipside
- The feasibility of implementing stablecoin legislation and a digital dollar in the U.S., citing technical and political hurdles that could hinder their adoption.
- That stablecoins and digital currencies could exacerbate income inequality and financial exclusion, as they may not benefit low-income individuals who lack access to digital technologies and financial services.
- The increasing popularity of stablecoins and digital currencies could fuel a new wave of speculative investments.
Why You Should Care
As Circle is a significant stablecoin issuer in the cryptocurrency market, the comments made by its CEO, Jeremy Allaire, regarding the urgent need for stablecoin legislation and digitization of the U.S. dollar hold great importance.
However, if Congress passes legislation that hinders Circle or forces them to make significant changes, it could have far-reaching implications for the stablecoin market and the wider cryptocurrency ecosystem.
To learn more about the impact of investor worries on the value of USD Coin, read here:
Investor Worries Drive Market Value of USD Coin Down by $13 Billion
To learn more about the second attempt of House Republicans to introduce stablecoin legislation, read here: