Stablecoins could rival cards - Fed payments expert

It certainly looks as if stablecoins could start eating into debit cards and credit cards, but only in the USA for now, where cards are very expensive and USD stablecoins are proliferating. The main everyday use for stablecoins outside of crypto is in cross-border remittances, ecommerce and B2B payments, especially in USD - making it unlikely stablecoins will scale in other currencies any time soon. 

I am unsure it is correct to say stablecoins developed out of a need for crypto traders to avoid volatile price swings. Certainly, they can be used to dip in and out of crypto very quickly, but they really developed to avoid dependency on bank payments to settle crypto trades, in an environment where banks had no appetite to have any association with crypto.

More on the topic here: https://jeremylight.substack.com/p/stablecoin-to-heaven?r=axqgy

The issue with stablecoins is that in times when checking accounts give hardly any interest on deposits, the stablecoins can replace both the bank account and the payment systems associated with it. Not only debit cards. The issue on "assets backing the stable coin program" is close to the issue on equity requirements and risk management in deposit taking credit institutions. The development of stablecoins into a de facto deposit and payment system can well trigger the need for a banking license. If not, then clear demarcation lines are needed for stable coins unless we want banks to disappear from the deposit and payments arena. Banks have a burden of neccessary reguylatory requirements to meet in order to operate deposit taking and payment service. If such cost driving undertakings can be circumvented  with stablecoin set-ups there will be a slide from from banking as we know it today into the much less regulated and more easily managed stable coins until major player failures causes losses to consumers and businesses and trigger banking-style regulatory intervention for stablecoins. The easiest way to regulate is to conclude that the stablecoin holding service is deposit taking and the transfer of stablecoins from one holder to another is a payment and has to meet the rules for payment services.