Rich by Coin

At the World Economic Forum in Davos this week, stablecoins and related crypto tokens emerged as a central topic as discussions stretched across how digital money could reshape future payments and financial interoperability. Central banks and crypto industry representatives engaged in extensive debates about the future of the financial system, underscoring a broader tension between traditional finance and tokenized assets. In one notable exchange, Coinbase CEO Brian Armstrong outlined a provocative view that, within a few years, there might be only a handful of traditional currencies remaining globally, with much of the world moving to US-based stablecoins and Bitcoin. Definitional clarity featured prominently: stablecoins are digital money pegged to the exchange rate of conventional currencies or other assets and are typically backed by reserves in those currencies or by government securities.

Market data cited last year place the total capital in stablecoins at almost 300 billion euros, with the bulk pegged to the US dollar via issuers like Tether’s USDT and Circle’s USDC. Regulatory momentum also figured prominently, with Donald Trump’s 2025 legislation spurring a US industry boom that European central banks are watching closely, while France signaled plans to harmonize rules under its 2026 G7 presidency. Industry executives stressed the need for regulatory clarity, noting that MiCA in Europe is comparatively advanced. Ripple CEO Brad Garlinghouse said the industry helped shape the administration’s selection and called for further steps to refine oversight.

The Davos discussions also touched on tokenization beyond payments, with real estate and fund tokens offering new liquidity channels, and ongoing initiatives cited by Euroclear. IMF’s Dan Katz cited inclusion and better financial market access as advantages of stablecoins and tokenization. In Africa, US dollar–based stablecoins have seen strong uptake, aiding businesses and individuals in accessing international markets and reducing remittance costs. Despite these developments, the pace of Europe’s digital euro remains slower, with other regions advancing more quickly through systems like Brazil’s PIX and the digital yuan.