EVENTS
Event Highlights
Luncheon Talk on “Stablecoins - Unified Ledger - Bretton Woods 2.0”
2025-09-30
On 30 September, the Maritime Silk Road Society (MSRS) and the Silk Road Economic Development Research Center jointly organized a luncheon talk titled "Stablecoin—Unified Ledger—Bretton 2.0." We were honored to have Mr Esmond Lee, Advisor of Euroclear Group; Visiting Lecturer of Ng Teng Fong · Sino Group Belt and Road Research Institute of the Hong Kong Chu Hai College, as the keynote speaker. Before the lecture began, participants enjoyed a light lunch, and Mr Alex Wong, CEO of MSRS, and Mr Joseph Chan, Chairman of the Silk Road Economic Development Research Center and Honorary Advisor of MSRS, presented a certificate of appreciation to Mr Lee.
Mr Lee began by introducing the concepts of stablecoins, unified ledger, and Bretton 2.0. He explained that their digitized transactions and stable value pegged to specific assets are advantageous for financial market transactions. He predicted that the money supply of the three major economic blocs would continue to increase over the coming decades, the velocity of money circulation would accelerate, and global asset prices would show an upward trend. These factors are interconnected and will collectively shape long-term economic direction.
In light of global stablecoins developments, if these predictions materialize, stablecoins could become a key bridging tool. Their characteristics of "fast, low-cost payments" and "value storage" would align with the need for accelerated money circulation. Moreover, in the context of rising asset prices, stablecoins could provide real-time settlement support for transactions involving tokenized assets, such as stocks, bonds, and physical properties, thereby enhancing the efficiency of asset transactions.
Mr Lee pointed out that jurisdictions like Hong Kong and the United States have already established regulatory frameworks for stablecoins through legislation, such as Stablecoin Ordinance of Hong Kong and the U.S. GENIUS Act, laying the foundation for stablecoins development. If the money supply increases significantly, the issuance of compliant stablecoins is likely to expand accordingly. For instance, the U.S. USD stablecoin is expected to grow to several trillion dollars in the coming years, potentially playing a more important role in cross-border payments and capital market transactions, and becoming a key vehicle for payments and settlements amid rising asset prices.
Mr Lee emphasised that the significance of the stablecoins stretched well beyond the clearing and settlement venue. Stablecoins may create a new monetary order.
Mr Lee helped to draft the article “Could stablecoins become the cornerstone of the World’s future monetary system?” published in Banking Today 144 recently. As suggested by the article, “in the US, the creation of a virtuous cycle would require stablecoins issuers to be mandated by law to use the reserve backing to buy short-dated US Treasuries and short-dated US Federal Reserve Bills. Through the funds raised by selling short-dated US Treasuries and short-dated US Federal Reserve Bills, the US Government and US Federal Reserve would have more resources to develop the US economy and financial sector, consequently a virtuous cycle could be established.” So, the significance of stablecoins is mainly in creating a new monetary order rather than improving the efficiency of the clearing and settlement systems.
Given the dominance of the USD in the world market: 88% of the foreign exchange transactions, 50% of the group payments, 58% of the world reserves and likely to be over 70% of the world’s capital market transaction are in USD, what happens in the US will have a significant impact on the rest of the world.
With the oncoming of stablecoins, the world money supply will increase, the world money velocity of circulation will increase, the world interest rate will come down because the US government requires the stablecoins issuer to buy US Treasuries as backing for the stablecoins issued, world economic will speed up - the situation will be very similar to the situation in the 1970s, 1980s and 1990s when the US adopted a free monetary stance after the US Government severed the link of the USD to Gold at USD 35 per ounce in December 1971.
The significance of stablecoins is that it helps the US Government to create a new monetary order, to the effect that the US Government can pursue de facto quantitative easing without the need to seek help from the US Federal Reserve.
If the economic historians of the next generation look back 30 years from now in 2055, they will probably notice the US GENIUS (Guiding and Establishing the National Innovation of the US Stablecoins) Act was as important as the de-linking of the USD to Gold at USD 35 per ounce in December 1971. The rest of the world would need to participate either directly or indirectly to share the booming benefits. The Hong Kong stock market, the Shanghai stock market, and the Shenzhen stock market have started to benefit from this de-facto quantitative easing.
Finally, the participants actively asked questions, further discussing various aspects of stablecoins, such as their impact on the economy, how they influence interest rates and money supply, their differences from current digital payment systems, the potential emergence of economic hegemony, and regulatory issues. The talk concluded successfully in a lively atmosphere.
