According to a recent Bank of International Settlements (BIS) working paper, a bank run on a major stablecoin issuer could cause “potential fire sales” in short-dated Treasuries.Researchers claim that stablecoin issuers’ pricing impact on the world’s largest bond market is “already measurable” and given the tame environment of steadily bullish growth on which they based their analysis, “is likely to be a lower bound of potential fire sale effects.”In other words, because data available to BIS researchers is orderly, linear data from many years of stable market environments, estimates of stablecoins’ impact on Treasuries are necessarily conservative.
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32 sats \ 0 replies \ @ken 4h
You can't have your cake and eat it too. You can't use stablecoins to increase global demand for treasuries, but then also complain that stablecoin issuers hold too many treasuries and thus represent risk
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24 sats \ 0 replies \ @ZezzebbulTheMysterious 8h
Hahaha no, the BIS is throwing shade on their existential threat. They claim 3x impact on exiting vs entering the stable markets. I say the crooked private ledger days are coming to a close, and the market demands radical transparency!
If you attempt to fight math, the math will always beat you.
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