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Visa’s Head of Crypto Cuy Sheffield predicts that stablecoins based on non-dollar fiat currencies will see significant growth in the coming years.
Speaking at the Solana Breakpoint event in Singapore, Sheffield noted that while USD stablecoins dominate the market, other fiat currencies have a role to play in the future of cross-border payments.
“The dollar is great for cross-border, but then you need to be able to convert quickly and efficiently,” Sheffield said, adding: “Other local currency stablecoins have a big role to play in this.”
Currently, USD-based stablecoins like USDT and USDC make up 99% of the stablecoin market, but Sheffield envisions a future where all major fiat currencies will be represented on-chain.
Sheffield also said that the diversity of stablecoin offerings is increasing, with many attempting to differentiate themselves from the dominant USD options. He noted that while most users are now familiar with stablecoins and understand their purpose, there are other use cases where the brand behind the stablecoin may not be as important as the economics behind it.
The stablecoin market has seen new entrants this year, such as PayPal’s PYUSD and BitGo’s USDS, both of which are trying to gain a foothold among established companies. The latter, for example, aims to attract institutions by offering financial incentives to provide liquidity, while London-based fintech firm Revolut has also announced plans to launch its own stablecoin.
Sheffield described 2024 as a “watershed” year for stablecoins as non-crypto businesses increasingly use them to solve the payment challenges of offshore freelancers. Many freelancers in countries like Nigeria and Argentina prefer to be paid in dollars, making stablecoins a practical solution for international payments.
*This is not investment advice.