As explained earlier in the series of Bitcoin vs Stablecoins, different analysts and experts have different opinions on how BTC and stablecoins operate. Surprisingly, the battle as of yet ended in a tie with experts giving opposite binary opinions on whether Bitcoin or Stablecoins would become the future transactional currency. BlockPublisher got in touch with Chris Wittenborn, Head of Strategy & Business Development at Velocity Markets, this time around who believed that stablecoins aren’t strong enough to compete against BTC because of their inefficient underlying protocols, and they’ll face struggle. He stated,
It depends on what you mean as a “transactional currency.” If we are speaking about its use in day-to-day transactions, stablecoins can only be as efficient as their underlying protocol. Given the distributed nature of the protocols supporting stablecoins, there’s currently (and in foreseeable future) going to be struggles in competing against centralized payment processors in terms of transactional bandwidth.
Although termed as digital gold, Bitcoin is already way ahead as it is being used for a good amount of transactions daily. The volumes of BTC haven’t dropped and with all the regulation and ETF talk floating around, the numbers are only expected to rise. Chris stated in this regard,
BTC transacts around 10% of its marketcap per day, vs gold at sub 1%. So it is clear that despite there being people that view Bitcoin as digital gold, the sheer fact that there are still so many digital assets priced against BTC that people are still utilizing BTC to facilitate exchange transactions.
Even with the given facts, it’s not easy to make a binary decision whether stablecoins or BTC would become the leading transactional currency. Stablecoins have been able to bring in a lot of liquidity for the market. Tether climbing to the 6th place in the coinmarketcap also clearly shows the inclination of people towards a stable currency. But, the problem of exchanges where there are no Stablecoin/fiat pairs still puts BTC on the top. Chris concluded,
It’s probably too early to declare stablecoins as transactional winners just because there’s still a lot of issues that need to be sorted with exchanges. It’s interesting to see some large overseas exchanges where stablecoins are the most liquid and dominant pairs vs some of large domestic (US) exchanges where the fiat pairs are still dominating the stablecoin pairs in daily volume.