Stablecoins vs Traditional Banking
The Block·
60-second summary
Stablecoin issuers are holding vast amounts of deposits, taking cash in return for issuing their coin onchain, making them similar to traditional banks. However, unlike banks, stablecoin issuers operate on a decentralized network, with no regulatory oversight. This unique blend of traditional banking and cryptocurrency is creating a new financial landscape, challenging traditional banking models and offering alternative solutions.
A stablecoin is a cryptocurrency pegged to a reference asset, such as the U.S. dollar or Euro. Like a bank, stablecoin issuers hold onto vast amounts of deposits, as they take cash in return for issuing their coin onchain. This makes them similar in some ways to a traditional bank, but the two differ in […]