Economist Hong Hao predicted that the market value of stablecoins could surpass $1 trillion in the near term, according to remarks published by Investment News in a summary of his comments from a recent online discussion.
Hong, managing partner at Lotus Asset Management, said the total stablecoin market remains small, but he expects expansion as more firms enter the sector.
“Stablecoins issued in Hong Kong may be more stable than those in the U.S.,” Hong said, pointing to Hong Kong’s regulatory clarity and resource base. He added that while several Chinese tech firms have obtained licenses to issue stablecoins, many participants are still formulating operational models.
He noted that most stablecoins issued in Hong Kong are likely to be HKD-denominated rather than backed by U.S. Treasuries, citing the strength of the Hong Kong Monetary Authority’s foreign reserves.
“There have been multiple collapses in the U.S. system,” he said. “It’s not yet mature or completely safe.” He stressed that despite U.S. dominance in early-stage issuance, other currencies could eventually serve as reserve anchors, including gold, Swiss francs, or the pound.
He specifically referenced past breakdowns in U.S.-issued stablecoins, such as USDC’s depegging events, to argue that the U.S. framework remains underdeveloped. He contrasted this with Hong Kong’s licensing structure and currency peg, suggesting that Hong Kong’s model may offer greater reliability in the long run.
