Despite all the fury and excitement around cryptocurrency and blockchain, the issue of scalability of these technologies continues to remain a contentious point impeding their widespread adoption. In the case of cryptocurrencies, market volatility is playing spoilsport as the continuous upward or downward movement in the prices is keeping the investors from taking a plunge into digital coins. The classic example of Bitcoin value which once reached around $20,000 in December 2017 only to come crashing to $3,200 in December 2018 testifies how turbulent cryptocurrency market turn out to be. Even the present scenario is very tumultuous with prices of all the cryptocurrencies changing at breakneck speed. Blockchain technology, on the other hand, does not have any such turbulence issue, but its applications in the real-world cases are quite limited in numbers. No doubt, with the passage of time blockchain technology, is going to find favor with many more industries but for now, its utility seems to be limited in its scope.
Stablecoin Growth Story
If there is one segment which is defying the growth expectations of the experts, it is the Stablecoin. As the name suggests, Stablecoin is a kind of cryptocurrency whose value does not fluctuate. In other words, a Stablecoin is pegged to fiat currencies that will provide stability to its value; putting to rest the biggest demerit of instability attached to cryptocurrencies. Not only Stablecoins are experiencing tremendous growth, but the competition amongst them is also intensifying with each passing day. Many experts believe that this growth and competitive trend in the field of Stablecoin is going to continue in the future too with full competitive intensity. Stan Stalnaker, who founded Hub Culture, said that the competitive intensity between Stablecoins is going to increase in future thanks to the foray of many big banks in this segment with their own Stablecoins. New technologies like tokenization and blockchain have made possible the process of issuing the value through Stablecoins and many big organizations are adopting these technologies to come out with their own Stablecoin. This trend is going to further intensify in the future which in turn will stimulate the competitive intensity in the segment.
Not only the banks and financial technology firms, even big corporate houses like Facebook are reportedly working on the Stablecoin project. Among these, the Stablecoin of Facebook codenamed “Project Libra” is the one which is most popular, and the company is going to use it to develop a whole ecosystem of payments on its social media platform. Given the large user base of around 2 billion people, Facebook’s Stablecoin can easily become a dominant force in the industry provided it is able to convince the users of its merit. Also, it is not necessary that all users of Facebook are going to utilize its Stablecoin for transactions.
In sum, Stablecoins offer a medium of transformation from conventional currency to cryptocurrency. It is something that offers the best of both worlds – stability of the conventional currency and convenience of digital currency. This is even as many crypto enthusiasts flay the property of Stablecoin being attached to the conventional fiat currency or assets.