Sveinn Valfells / Aug 08, 2023


2 min read

Towards the first trillion in fiat stablecoins

Just like the Monerium EURe powers the Gnosis Pay VISA card, Paxos is now powering PayPal payments in the US with the PYUSD.

These and other mainstream DeFi use cases pave the way towards the first trillion euros or dollars in fiat stablecoin market cap. The first trillion will come from regulated, on-shore recurring mainstream applications including payments, e-commerce, and capital markets.

Other stablecoins will struggle to find mainstream adoption unless they are regulated under the appropriate frameworks in the jurisdictions of their issuers. The stablecoins used in cyclical, offshore, unregulated speculation will not scale into the mainstream.

Currently, only Europe offers unequivocal regulatory clarity for fiat stablecoins. Monerium leads the way with the first euro onchain, fully transferable between onchain wallets and offchain bank accounts, and compatible with the Market in Crypto-Asset regulations.

The trust-based approach that Paxos has taken in the US is in many ways similar to the European e-money rules under which Monerium operates, both are backed by segregated high-quality assets.

In contrast, Circle’s USDC is based on non-homogeneous state money transmission licenses which don’t have the same protections as e-money in Europe or trusts in the US.

The US should resolve regulatory uncertainty for fiat stablecoins by adopting the tried and tested European e-money framework.