According to market news, Ben O’Neill, the head of cash flow at Bridge, stated at the Consensus conference that the dominance of Tether and Circle in the stablecoin market is generally detrimental to the growth of the entire industry. He pointed out that the design choices of these two major issuers have their pros and cons, but they are not suitable for all use cases.
Tether has built a dollar shadow economy independent of the U.S. financial system, while Circle’s USDC follows a regulated route in the U.S. and deeply engages in DeFi. O’Neill analyzed the shortcomings of both companies from the perspective of large payment companies: Tether’s redemption fee of 10 basis points is too expensive for payment companies, while Circle’s continuous increase in destruction fees has a net negative impact on companies like Visa that want to handle trillions of dollars in card settlements.
He believes that more stablecoins need to be built and optimized for specific use cases in the coming years, while the role of clearinghouses will rise to make exchanges between stablecoins as efficient as possible. He warned that more competition is needed; otherwise, Tether and Circle will only continue to raise fees and not share profits, making stablecoins increasingly less like money.
