Chinese Analyst Predicts $1 Trillion Stablecoin Boom – Here’s Why It Matters
The stablecoin revolution is about to hit hyperdrive.
Forget 'crypto winter'—this forecast calls for a trillion-degree thaw. One prominent Chinese analyst just dropped a bombshell prediction that'll make TradFi bankers clutch their pearls.
The $1 Trillion Stability Paradox
Stablecoins aren't just surviving—they're primed to eat traditional finance's lunch. While Wall Street still debates 'blockchain potential,' the real disruption's happening in plain sight: dollar-pegged tokens becoming the lifeblood of global crypto markets.
Bypassing the Old Guard
No permission needed. No slow-moving regulators. Just pure, frictionless value transfer that cuts out correspondent banking like a hot knife through bureaucratic butter. (Take that, SWIFT.)
The kicker? This growth comes despite—or perhaps because of—the occasional stablecoin 'hiccup.' Because when banks fail, the crypto crowd just forks, deploys, and moves on. Darwinism meets DeFi.
So while traditional finance builds moats, stablecoins are launching rockets. Place your bets—but maybe keep some dry powder for when the suits finally 'discover' this trillion-dollar opportunity.
HKD Stablecoin vs USD Stablecoin
He noted that most stablecoins issued in Hong Kong are likely to be HKD-denominated rather than backed by U.S. Treasuries, citing the strength of the Hong Kong Monetary Authority’s foreign reserves.
“Stablecoins issued in Hong Kong may be more stable than those in the U.S.,” Hong said, pointing to Hong Kong’s regulatory clarity and resource base. He added that while several Chinese tech firms have obtained licenses to issue stablecoins, many participants are still formulating operational models.
Hong also said the structure of the stablecoin market could boost demand for U.S. Treasuries, but future flows will depend on the fiscal position of the U.S. government.
He specifically referenced past breakdowns in U.S.-issued stablecoins, such as USDC’s depegging events, to argue that the U.S. framework remains underdeveloped. He contrasted this with Hong Kong’s licensing structure and currency peg, suggesting that Hong Kong’s model may offer greater reliability in the long run.
“There have been multiple collapses in the U.S. system,” he said. “It’s not yet mature or completely safe.” He stressed that despite U.S. dominance in early-stage issuance, other currencies could eventually serve as reserve anchors, including gold, Swiss francs, or the pound.
GTJA, China’s largest broker formed by merging two of China’s largest brokers recently, was granted the license to trade crypto assets. Stock tripled.
It’s not clear just yet how much revenue this new line of business will bring in. After all, all
HK major crypto exchanges are… pic.twitter.com/p3EzrrvwkY
Cross-Border Trade in Global Competition.
In the context of cross-border trade, he argued that stablecoins can reduce costs and speed up transactions, especially for foreign entities engaging with China.
However, he acknowledged the tension between these benefits and regulatory control. “Stablecoins decentralize payment systems, which is something regulators need to watch carefully,” he said.
Hong emphasized that current stablecoin activity represents a long-term shift in digital payments rather than a short-term trend. “The stablecoin boom has already begun, and its role in daily financial life will only grow,” he said.
While stablecoin policy is still taking shape globally, its integration into formal financial systems may test the boundaries between sovereign control and private issuance. For jurisdictions such as Hong Kong, the challenge will be maintaining monetary oversight without stifling cross-border digital payment infrastructure that continues to evolve.
Frequently Asked Questions (FAQs)
What role might stablecoins play in China’s trade strategy?He believes stablecoins can reduce transaction costs and processing times in cross-border commerce, especially for foreign entities transacting with China.
Are other reserve currencies likely to play a role in future stablecoins?Hong suggested that gold, Swiss francs, or pounds could eventually serve as reserve anchors for stablecoins beyond the current USD dominance.
What is the regulatory concern with stablecoins?Stablecoins decentralize payment systems, raising questions for regulators over control, compliance, and systemic risk management.
