[Reporter's Notebook] Stablecoins, 3 hurdles to overcome to become real money

"Can Stablecoins Really Become 'Money'?"

Though it seems like a simple question, this inquiry pierces the essence of blockchain and financial policy worldwide. The recent research report by a16z crypto approaches this question structurally. To actually function like legal tender, stablecoins must overcome three key thresholds: Liquidity, Sovereignty, and Credit — these are the core conditions for monetization.

These are not merely technical requirements, but comprehensive challenges involving global monetary order, national policies, and market infrastructure. This provides particularly important implications for countries like Korea, which have advanced digital financial infrastructure but slow institutionalization.

First Threshold: Liquidity – It Must Be Easily Used and Exchanged by Everyone

For stablecoins to function like money, they must be smoothly usable inside and outside the market. Beyond just being traded on exchanges, they need on and off-ramp infrastructure to become a practical payment method in daily life.

a16z points out that this requires a decentralized payment network, deposit and withdrawal systems, and a liquidity structure at the level of a 'clearing house' through cooperation with banks and fintech. In fact, Circle is attempting to secure such liquidity by applying for bank authorization in the US, and Stripe has declared support for USDC payments.

In Korea, while powerful payment platforms like Toss, KakaoPay, and NaverPay exist, legal constraints make integration with stablecoins distant. Issuing won-based stablecoins is practically blocked, thereby limiting experiments with decentralized payment systems.

Second Threshold: Sovereignty – Tension with National Monetary Policies

The second threshold is the potential collision with national monetary sovereignty. Most stablecoins are dollar-based. In this structure, USDC and USDT effectively act as digital dollars, already serving as unofficial reserve currencies in countries with weak domestic currencies.

a16z describes this as "digital dollarization" and warns of the risk that governments might lose monetary policy tools. Notably, in high-inflation countries like Argentina, Nigeria, and Turkey, dollar stablecoin demand is higher than legal tender.

While Korea has relatively stable monetary sovereignty, the digital asset era might present a new challenge of coexistence between CBDC and private stablecoins. Will the government strengthen control or find a balance with private innovation?

Third Threshold: Credit – The Question of 'What Backs It'

Money derives from trust. So where does stablecoin trust come from?

Currently, most stablecoins are backed by physical assets like US Treasury bonds and deposits. USDC is backed over 70% by short-term government bonds, estimated at around $128 billion. But is this collateral structure the ultimate solution?

a16z argues that for stablecoins to establish themselves as more flexible and scalable currency, new structural designs are needed, such as RWA (on-chain tokenization of real-world assets), programmable collateral, and on-chain credit systems.

In Korea, experiments with financial institutions tokenizing digital deposits or bonds as stablecoins are still in early stages. Comprehensive experiments are hindered by unresolved legal interpretations, accounting standards, and financial supervision criteria.

Korea's Choices Before These Three Thresholds

Currently, global stablecoin circulation exceeds $230 billion, with monthly transaction volumes approaching $2 trillion. USDC alone has recorded cumulative transactions over $18 trillion. This signifies not just blockchain technological advancement, but a structural transformation of digital currency systems.

What choices can Korea make in this flow?

While digital infrastructure and user technological capabilities are world-class, legal systems remain passive and conservative. In the current regulatory vacuum, Korea will inevitably fall behind in international financial leadership competition surrounding stablecoins.

a16z says:

"Stablecoins are not just a technology, but an experimental fundamental redesign of money."

📝 Reporter's Note

Stablecoins are not just 'coins with fixed prices'. They represent the most complex financial structural experiment intertwining nation, market, and technology. The three thresholds to becoming 'real money' are ultimately a question of how to design trust infrastructure in the digital age.

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