04-06, 17:10–17:30 (Europe/Zurich), Surge Stage
Stablecoins play a crucial role in today's blockchains, bringing liquidity and fostering user adoption, as seen in both L1 and L2. It is therefore extremely important to understand their future development. So far, we have seen competition between centralized and decentralized solutions, but the introduction of new assets, "real world assets" and CBDCs, could reshape this landscape. We will discuss recent product innovations in this area and, based on a competitive economics approach, discuss possible future outcomes. Specifically, this talk will explore three key areas: 1) the current landscape of value transfer using low-volatility assets and the motivations behind such transactions; 2) emerging methods and motivations for value transfer on Ethereum; and 3) an examination of future value transfer mechanisms through the lens of competition economics, considering the evolving roles of stablecoins, CBDCs, and real-world assets.
Users seek to exchange value without fear of price volatility, which led to the invention of stablecoins. Despite significant setbacks such as the Terra/Luna crash and the USDC depegging event, stablecoins have gained dominance within the blockchain ecosystem (USDT is the third largest cryptoasset by market capitalization), marking their success from a user perspective. But not only that, they are also very attractive from a business perspective (see for example, Tether's billion-dollar profits). So stablecoins have been very successful, especially those run by traditional companies. But will it stay that way? When discussing stablecoins, it is important to consider their particula forms and other potential possibility to exchange value. As such, the introduction of CBDCs and other "real-world assets" should be considered, which could potentially affect how users interact with stablecoins in the future.
With this in mind, we will 1) present today's ability to move value with low price volatility assets and discuss the incentives from different groups to to so. 2) We will discuss new ways (on Ethereum) to transfer value and the motivations for users and businesses to do so. 3) Based on competition economics, we will then discuss possible outcomes of how value will be transferred in the future, i.e. the future role of stablecoins (or similar), CBDCs, and real-world assets.
The talk will address questions such as: Why are users adopting stablecoins? What drives their adoption? How is it possible to generate such significant profits, and is it sustainable? What is the role of more decentralized solutions like DAI? In addition, how will the potential introduction of Central Bank Digital Currencies (CBDCs) into the mix redefine the landscape. Will stablecoins continue to hold their own? How could "real world assets" change the dynamics? This discussion will explore the economic future of payments by addressing these critical questions.
Matthias Hafner is the Director of the Center of Cryptoeconomics and Head Blockchain and Cryptoassets at Swiss Economics. He focuses on projects related to blockchain applications, token economics and competition. Matthias has led numerous projects and supported various startups, corporates, and decision-makers. In addition, Matthias is a mentor for startups of CV Labs as well as DAO Suisse, a researcher at the University of Zurich, and an advisor to multiple blockchain projects. Before joining the Center for Cryptoeconomics, Matthias worked for the Swiss Competition Commission.