Can Stablecoins Be Stable?

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

Theoretical analysis of whether fiat-backed stablecoins can remain stable without deposit insurance or a lender of last resort.

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Key findings

• Stablecoins are exposed to runs absent a backstop; par stability is not guaranteed by full reserves alone.
• Explores conditions (fees, redemption design) under which a peg can survive stress.

Topics: Peg Stability & Runs · Design & Economics

Cite this

Adrien d'Avernas, Vincent Maurin, Quentin Vandeweyer (2022). Can Stablecoins Be Stable? Working paper (Becker Friedman Institute / SSRN).

@techreport{davernas2022canstablecoinsbestable,
  title = {Can Stablecoins Be Stable?},
  author = {Adrien d'Avernas and Vincent Maurin and Quentin Vandeweyer},
  year = {2022},
  institution = {SSRN},
  howpublished = {Working paper (Becker Friedman Institute / SSRN)},
  url = {https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4155351},
  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