The CEO of Circle, a stablecoin issuer behind USD Coin (USDC), has called on the US government to implement stablecoin legislation and digitize the US dollar to counter the ongoing “very active de-dollarization taking place” around the world. Jeremy Allaire made these remarks during his speech at the Consensus 2023 conference on April 26th in response to the recent US banking crisis.
According to Allaire, the US should take action to prevent alternative currencies and payment systems from undermining the dollar’s dominance. He called on Congress and the Federal Reserve to implement stablecoin legislation and the digital dollar, respectively, to keep the US dollar “competitive” and “safe” in the internet era. Allaire added that the demand for digital dollars like USDC is high worldwide, particularly in emerging markets and regions where people prefer holding a digital dollar over their local banking systems. He emphasized this point in a tweet, saying, “The desire for alternative payment systems all around the world [is happening]… This is happening and it’s accelerating.”
Allaire warned that the US is at risk of losing its position as a global financial leader and termed this a “giant missed opportunity” for the country. Furthermore, he stressed that Circle has been taking some responsibility into its own hands with the launch of USDC on Cross-Chain Transfer Protocol, terming it the “most important new piece of blockchain infrastructure” since the company began minting and issuing USDC in 2017.
Meanwhile, the Chinese yuan overtook the dollar as the most-used currency for cross-border transactions in China for the first time in March, Reuters reported. The yuan share rose to a record high of 48%, up from nearly zero in 2010, while the US share declined to 47%, down from 83% over the same period. The yuan’s rise underscores China’s push to establish its currency as a global standard and poses a challenge to the US in maintaining its position as the world’s dominant currency.
Thus, if the US wants to stay ahead in the global financial race, it must act fast to provide new and innovative solutions that address the needs of the internet era. Digital transformation initiatives such as the digital dollar and digital currencies like USDC will be critical in reducing the risks of the US banking system and improving the efficiency of global financial transactions. Also, stablecoin legislation will help protect investors and safeguard the US financial system in the long run.
In conclusion, the US must act fast and decisively to maintain its global financial supremacy. If it fails to do so, increasing numbers of people will use alternative currencies and payment systems, leaving behind the US dollar in favor of local banking systems or other digital currencies. By adopting stablecoin legislation and digitizing the US dollar, the US can turn the tide and promote its economic growth and prosperity in the years to come.