Ki Young Ju predicts the emergence of "dark stablecoin" – a stablecoin not controlled by the government – as current regulations become stricter.
In the context of governments worldwide rapidly building legal frameworks to regulate stablecoins, Cryptoquant's CEO, Ki Young Ju, has made a prediction about the rise of a new type of stable currency – "dark stablecoin" – designed to avoid government oversight and maintain censorship resistance.
Young Ju argues that as traditional stablecoins like USDT and USDC become increasingly regulated, they will gradually lose the appeal that made users view them as an alternative to the US dollar. He points out that issuers like Circle and Tether currently hold collateral assets in traditional banks or financial institutions, making them easily susceptible to government intervention.
"With the potential for direct on-chain monitoring measures, including tax collection through smart contracts or asset freezing according to government regulations, the 'free' characteristics of stablecoins will be diminished," Young Ju warns.
Two Potential Development Models
According to the Cryptoquant CEO's analysis, Algorithmic Stablecoin could be developed in two main directions: Algorithmic Stablecoin maintaining a USD peg – similar to the previous TerraUSD model, although most algorithmic stablecoins have failed; and stablecoins issued by countries that do not censor financial transactions – these currencies could provide a payment platform free from political interference.
Young Ju also raised questions about Tether's potential future role. He noted that Tether could become a significant actor if they decide not to comply with US government regulations: "If Tether chooses not to comply with US government regulations under a future Trump administration, they could become a dark stablecoin in an increasingly censored Internet economy."
However, he also acknowledges that this scenario is unlikely, given Tether's long history of cooperation with regulatory agencies.
Young Ju concludes that assets related to dark stablecoins could offer investment potential in the Internet Capital market, especially as demand for unsupervised payment methods for large-scale international transactions may increase.
