Davos Consensus Emerges: Payment Stablecoins Defined as Payment-Grade Cash Instruments, Circle CEO Proposes "New Physics of Money"

Odaily News During the Davos Forum, stablecoins became a hot topic. Industry insiders generally believe that stablecoins have the potential to reshape the global payment system, but their potential risks should not be overlooked. Jeremy Allaire, Co-founder and CEO of Circle, stated that under regulatory frameworks such as those in the United States and the European Union, payment stablecoins are clearly defined as "cash instruments" for payment and settlement. Therefore, issuers are not allowed to pay interest to holders, and he personally supports this design. Regarding the practice of some stablecoin projects subsidizing users in the form of "rewards," Jeremy Allaire believes that the banking industry's concerns about "deposits being drained and credit drying up" are overblown. He pointed out that the rise of money market funds in history did not cause substantial damage to the banking credit system. Furthermore, Jeremy Allaire introduced the concept of the "New Physics of Money," arguing that stablecoins significantly enhance the efficiency of capital flow and the velocity of money. In the future, society may only need a smaller monetary base to support large-scale economic activities. He also predicted that in the next 3 to 5 years, billions of AI agents will participate in the operation of the economic system. (Caixin)