Journal article · 2023

What Keeps Stablecoins Stable?

Richard K. Lyons, Ganesh Viswanath-Natraj · Journal of International Money and Finance (NBER WP 27136) · Elsevier

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

Empirical study of the arbitrage mechanism that holds fiat-backed stablecoins near their peg.

Read the source ↗

MethodologyEmpirical analysis of stablecoin prices and primary-market flows

Key findings

Peg deviations are corrected mainly through the primary market (mint/redeem by authorised participants).
Access to primary-market arbitrage strengthened peg stability over time.

Topics: Peg Stability & Runs · Market Structure & Adoption

Cite this

Richard K. Lyons, Ganesh Viswanath-Natraj (2023). What Keeps Stablecoins Stable? Journal of International Money and Finance (NBER WP 27136).

BibTeX

@article{lyons2023whatkeepsstablecoinsstable,
  title = {What Keeps Stablecoins Stable?},
  author = {Richard K. Lyons and Ganesh Viswanath-Natraj},
  year = {2023},
  institution = {Elsevier},
  journal = {Journal of International Money and Finance (NBER WP 27136)},
  url = {https://www.nber.org/papers/w27136},
  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