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Standard Chartered Bank executive: Stablecoins can mitigate the negative impact of the Federal Reserve's interest rate cuts on government bonds and money market tokens.
Alexander Deschatres, Head of Sponsorship and Responsibility for Standard Chartered Bank in Asia, stated that stablecoins can mitigate the negative impact of the Federal Reserve's interest rate cuts on government bonds and money market tokens.
“A $170 billion stablecoin supply is equivalent to a pool of money that can be converted into money market tokens and Treasury tokens, potentially providing a buffer against the negative impact of the Fed’s rate cuts,” said Alexandre Decharres. He believes that based on federal funds futures, the market currently expects a 100 basis point rate cut this year, which means that the benchmark borrowing cost will fall to 4.5% by the end of the year.
Still, this is an attractive yield compared to passively holding stablecoins.
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