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On par: a money view of stablecoins

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  • Iñaki Aldasoro
  • Perry Mehrling
  • Daniel H. Neilson

Abstract

This paper presents a money view analysis of the recent crypto innovation of stablecoins, which have seen a remarkable rise as well as some spectacular collapses. By analogizing on-chain with offshore, and developing an extended analogy of stablecoins with Eurodollars, we reveal the primitive character of the existing on-chain liquidity mechanisms that support the promise of par settlement by existing on-chain stablecoin models. Liquidity, not solvency, is the issue confronted by par settlement.

Suggested Citation

  • Iñaki Aldasoro & Perry Mehrling & Daniel H. Neilson, . "On par: a money view of stablecoins," Journal of Financial Market Infrastructures, Journal of Financial Market Infrastructures.
    • Handle: RePEc:rsk:journ7:7960145
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