There is a huge demand for stablecoin in the market right now. And the controversies going on with Tether don’t make it feel safe to use or hold it for a while. Therefore, Morgan Stanley thinks that banks might capitalize on the situation and take advantage of the same. This could be their proper way, into the crypto ecosystem and open a lot of revenue sources for them. Let’s take a look at what Morgan Stanley has to say about the same.
How can banks capitalize on stablecoin demand?
Stable coins are a huge market right now as they are the most preferred way of trading crypto or just buying it. It is unlikely that banks won’t take advantage of the same. People are inclined to deposit and stake their stable coins for good fixed annual returns. Some places offer 12% while others do 20% which makes it clear that people wanting to gain stable returns are willing to deposit their coins the fiat way.
At present, the market cap of Stablecoins is $137 billion which has increased from $20 billion a year ago. And this opens great potential for banks to have a deposit system giving fixed returns and using the same crypto elsewhere. The analyst from Morgan Stanley also pointed out that institutional investment is increasing and it is likely that altcoins are going to outperform Bitcoin in the future. She might have said this because at present banks getting involved in crypto are looking only at Bitcoin but there’s a lot of potential elsewhere.
Banks can charge for the minting and burning of stablecoins
Banks can generate a lot of revenue by charging for the minting and burning of stablecoins. It will also enable banks to make money by lending crypto through TradeFi which will be great. But this market is so big that if banks start to deal with the same, the government will have to come forward to regulate it. But all in all, things are super bullish as we are expecting even more crypto involvements of banks as we enter 2022.
What are your thoughts on Morgan Stanley’s analyst saying that banks might capitalize on stablecoin demand? And do you think that this will take the crypto industry forward? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.