Discussion Paper
Stablecoins and (Non)Crypto Shocks: A 2026 Update
Abstract: Stablecoins are digital assets whose value is pegged to that of a fiat currency, typically the U.S. dollar at a peg of $1.00 per token. In a previous blog post, we described the rapid growth of stablecoins through early 2025, highlighted changes in stablecoins’ reserve-asset composition, and examined their reactions to Bitcoin price shocks. In this post, we document the growth of stablecoins since our last post. Then, we examine how shocks from outside the crypto industry can impact the composition of stablecoins’ reserve assets. For our case study, we use the 2023 failure of Silicon Valley Bank (SVB) and its impact on USD Coin (USDC, issued by Circle), the second-largest stablecoin by market capitalization.
JEL Classification: G1; G11; G15; G28;
https://doi.org/10.59576/lse.20260731
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https://libertystreeteconomics.newyorkfed.org/2026/07/stablecoins-and-noncrypto-shocks-a-2026-update/
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Provider: Federal Reserve Bank of New York
Part of Series: Liberty Street Economics
Publication Date: 2026-07-31
Number: 20260731