Changpeng Zhao (CZ), the CEO of Binance, has stated that the crypto ecosystem may go beyond the dollar-pegged stablecoin age to other stablecoins which will be supported by other assets.
Stablecoins prove to be under the magnifying glass of regulators in a time when the crypto environment feels the heat of regulatory investigations in recent years, including popular crypto exchanges such as Binance.
Recently, the BUSD issuer, Paxos, and the SEC developed an entire saga. BUSD is a stablecoin bearing the brand of Binance. Same was the case involving Kraken, the crypto exchange. Since then, investors started to look for the stablecoin with the most stable pegging to preserve their investments.
According to a tweet from CZ, stablecoins register ‘significant’ pressure from several agencies. He predicts that the USD stablecoin market will shrink as a result, while the industry starts to look for alternatives.
Considered less volatile than other digital assets, stablecoins are pegged to fiat currency. Investors use stablecoins to cut down their volatility exposure. Recent years showcased that USD stablecoins have the most popularity. This kind of stablecoin is present in a majority proportion of the stablecoin market.
There are other stablecoins as well, backed by EUR, for example. However, the USD-pegged stablecoin remains dominant. Over 10 per cent of the world’s crypto market cap is consisted by BUSD, Tether, USD Coin, and DAI.
Despite that, CZ thinks that more stablecoins will emerge, for example, pegged by the Japanese yen, EUR, or the Singapore dollar.
