❓ Could euro- or Asia-backed stablecoins realistically compete with USDT/USDC?

[nihalsari]

It’s a tall order. USDT and USDC dominate because of dollar hegemony, liquidity depth, and entrenched network effects.

Liquidity moat: 90%+ of stablecoin pairs are dollar-based. Even if a euro- or Asia-backed coin exists, traders default to USD liquidity pools. Breaking that habit requires a seismic FX shift.

Regulatory weight: Europe’s MiCA creates a clear path for euro stablecoins, but banking rails and liquidity provisioning lag far behind U.S. issuers. In Asia, experiments like Hong Kong’s HKD stablecoin pilots or Japan’s bank-backed tokens are real, but fragmented.

Geopolitical wildcard: If U.S. Treasuries lose dominance (e.g., debt crisis, de-dollarization), demand for non-USD pegs could spike. That said, stablecoins aren’t just about backing — they’re about where people actually trade.

Best case: Euro- or Asia-pegged coins may capture regional settlement flows (like B2B trade invoicing in APAC), but global dominance remains firmly in dollar hands — at least until the dollar itself loses its reserve crown.

TL;DR: They can compete locally, but global liquidity ≠ ready to de-peg from USD.

[Nahid10]

The liquidity moat is almost impossible to overstate. Every major DEX, CEX, and lending market is built around USD pairs — not because traders love the dollar, but because liquidity gravity pulls everything toward the deepest pools. Even if euro- or yen-backed stablecoins get regulatory clarity and institutional support, they’ll struggle until there’s a structural incentive for traders to migrate. That could mean lower fees, FX arbitrage advantages, or geopolitical events that force regional adoption. Otherwise, even in Europe, people will default to USDT/USDC simply because it’s cheaper and faster to move size without slippage. The dollar’s global network effect is the moat — not just the collateral backing.

[jacson4]

That said, we shouldn’t dismiss the regional angle. MiCA gives euro stablecoins a legal framework that USDC/USDT lack in Europe, and Asia is actively experimenting with bank-issued tokens (Japan, HK, Singapore). These won’t dethrone the dollar overnight, but they can carve out serious niches: cross-border trade settlements, corporate invoicing, or domestic DeFi rails that don’t need USD exposure. Think of it like the early days of crypto itself — local adoption first, global liquidity later. If we do see de-dollarization accelerate — say U.S. debt spiral, reserve diversification, or a political shift — then these local stablecoins could suddenly become global contenders. Until then, they’ll live as regional complements rather than dollar killers.