Circle cryptocurrency company has set its eyes on thriving Asian cryptocurrency markets. The peer-to-peer payments technology firm based in Boston, Massachusetts, plans to launch its official headquarters in Singapore to expand its geographical presence in Asia.
The blockchain-focused financial services and payment firm is also developing an investment arm called Circle Ventures that aims to invest in Japanese yen stablecoin.
Speaking in an interview with Bloomberg media outlets, Circle CEO Jeremy Allaire explained that the major reason behind making such a business move is the booming use of stablecoins.
Circle sees Asia as a market with high potential to grow when it comes to stablecoins. Mr. Allaire expects significant growth in the stablecoin usage, especially the leading two stablecoins – category leader Tether and Circle’s USDC – on borrowing and lending markets. He sees potential growth with corporate balance sheets and therefore stated in the interview that the inflation environment and search for yield would mainly trigger the market’s move to stablecoins.
“Especially in the inflation environment we’re in and the search for yield, this is going to be a big, big theme. While a lot of people want to focus on people hedging by buying Bitcoin directly, we think for stewards of capital within corporations and corporate treasurers and so on, that an allocation into stablecoin yield is actually going to be really, really attractive.” Allaire said.
Circle expects stablecoin usage growth, including the booming decentralized finance (DeFi) and forex markets.
Circle also plans to offer support for the growth in stablecoins for payments and is currently hiring professionals to fill up its Singapore headquarters to make USDC “one of the first global stablecoins to be licensed in Singapore.”
The payment firm is working with the Monetary Authority of Singapore to boost the adoption of USDC to the nation’s major businesses.
Furthermore, Circle is also launching its interest-yielding product, Circle Yield, shortly.
Stablecoins are growing rapidly along with the wider crypto space, with some competition and co-existence with the CBDCs (Central Bank Digital Currencies).
Unlike their volatile crypto cousins, the current $130 billion stablecoin market has significantly grown because of its steady valuation and pegged to national currencies. For instance, USDC’s market value is currently about $35 billion, compared with $3.7 billion at the end of the previous year.
Stablecoins are transforming the way U.S. citizens pay for everything from cups of coffee, haircuts, petrol, cell phones, and others.
Recently Biden’s economic advisors, raised the need for Congress to establish regulatory oversight and formal market structures to protect and inform investors, issuers, and exchanges.
The Biden team recommended that Congress pass regulations that limit stablecoins issuance to insured banks. Therefore, classifying stablecoins issuers as banks is set to give government agencies like the Federal Reserve, the Federal Deposit Insurance Corporation, and others more extraordinary jurisdiction over their risk management, operations, and a better sense of the overall health industry.
Amid its plan to go public, Circle crypto firm is also seeking status as a national digital currency bank, which would operate under the guidance, rules, and oversight of the FDIC, Office of the Comptroller of the Currency (OCC), U.S. Treasury, and the Federal Reserve.
Unlike other digital assets, US SEC chairman Gary Gensler recently stated that stablecoins need to be monitored to avoid bankrolling activities.
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