Prepared by Alexandra Born, Johanne Evrard, Dimitris Georgarakos, Geoff Kenny, Claudia Lambert, Justus Meyer, Trixi Pairan and Luca Zannier The expanding stablecoin market, its increasing interlinkages with the financial sector and growing consumer holdings could affect financial stability in the euro area. The global stablecoin market has grown rapidly since 2020 but has recently plateaued (Chart A, panel a). At the same time, stablecoins have become increasingly interlinked with the traditional financial sector, particularly through reserve asset holdings. [ 1 ] While the euro -denominated stablecoin market has grown, it remains relatively small (Chart A, panel b).
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