Macro Musings with David Beckworth · Monday, September 14, 2026
Nellie Liang notes the substantial growth of the stablecoin market from approximately $25-30 billion in November 2021 to $275-300 billion currently. She recalls that an early Treasury report in 2021 raised concerns about the quality of reserve assets, operational risks, redemption risks, and the potential for non-financial companies, including big tech, to create 'walled gardens'.
“Stable coins then were about 25 or 30 billion dollars and now they're, you know, 275, 300 billion.”
“But it was the view was, they were being backed by reserve assets of uneven quality or unknown quality. They were purporting to be money and so that raised all kinds of questions about financial stability.”
“So we raised some issues about the quality of the reserve assets, the operational risks, the ability to function as money, redemption risks. And also, one risk, which was the possibility of non-financial companies creating money. And the potential for network externalities such as big tech companies creating money and creating wall gardens.”