Some Simple Economics of Stablecoins

⚠ The summary and findings below are the editor's working notes, pending verification against the source.

Economic framework for how stablecoins maintain value and the trade-offs across reserve designs.

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Key findings

• Frames stablecoin stability as a function of reserve quality, redemption guarantees and market structure.
• Fully-reserved designs trade capital efficiency for credibility.

Topics: Design & Economics

Cite this

Christian Catalini, Alonso de Gortari, Nihar Shah (2021). Some Simple Economics of Stablecoins SSRN / Annual Review of Financial Economics.

@techreport{catalini2021economicdesignstablecoins,
  title = {Some Simple Economics of Stablecoins},
  author = {Christian Catalini and Alonso de Gortari and Nihar Shah},
  year = {2021},
  institution = {SSRN},
  howpublished = {SSRN / Annual Review of Financial Economics},
  url = {https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3968148},
  note = {Indexed by Stablecoin Beat},
}

Indexed by Stablecoin Beat — we link to and summarise sources; we do not host copyrighted full text, and summaries are our own.  ·  All research  ·  Methodology