Jeremy Allaire believes that stablecoins offer immense opportunities outside of the cryptocurrency industry. The Circle CEO says a set of standards, like those that make near-instant data transfer on the internet possible, is needed for digital representations of fiat value to truly transform global commerce.
Allaire’s company started working on its own stablecoin project in early 2017. As he explains in a recent interview with Messari CEO Ryan Selkis, the company made the decision to move away from Bitcoin in 2016. Allaire says that the Bitcoin-as-a-store-of-value narrative was gaining traction at a time when Circle wanted to focus on tokenized finance.
Working with Coinbase, Circle launched USDC at the end of 2018 as an open standard. This latter point, for Allaire, is crucial if USDC, or any stablecoin, is to transform finance.
Allaire sees stablecoins as much more than a tool to help questionable cryptocurrency exchanges avoid regulatory scrutiny. He also sees them as more than just a means to enable decentralized finance. These “bootstrapped” use cases are just a “step along the way.”
The next chapter in the stablecoin story is adoption of payments and settlements more generally. For this to be successful, standards need to emerge, just like TCP/IP was needed for the internet to proliferate.
To illustrate the concept of standards further, Allaire uses the emergence of Visa. The payment network was actually formed as a result of numerous networks uniting under a single standard to enable the scaling of electronic retail payments. This is the kind of cooperation and interoperability, the CEO says, is crucial for stablecoins to disrupt global commerce.
Allaire thinks that stablecoins will be even more revolutionary than electronic payments were last century. Programmable money, lacking the volatility of assets like Bitcoin, makes all kinds of new financial relationships possible.
He also welcomes regulatory scrutiny in the stablecoin sector, something which he acknowledges Facebook’s Libra proposals as generating a lot of. BeInCrypto has reported frequently on global regulators and lawmakers expressing objections to the social network company’s financial ambitions last summer.
Although clearly not part of the Circle business model anymore, Allaire doesn’t seem to have totally fallen out of love with Bitcoin. He comments that having decentralized, permissionless value transfer networks is important and that Bitcoin is the best example we have of that.