{"id":9393,"date":"2025-09-01T10:08:05","date_gmt":"2025-09-01T10:08:05","guid":{"rendered":"https:\/\/bitunikey.com\/news\/nobel-prize-jean-tirole-winner-warns-of-hidden-stablecoin-risks\/"},"modified":"2025-09-01T10:08:17","modified_gmt":"2025-09-01T10:08:17","slug":"nobel-prize-jean-tirole-winner-warns-of-hidden-stablecoin-risks","status":"publish","type":"post","link":"https:\/\/bitunikey.com\/news\/nobel-prize-jean-tirole-winner-warns-of-hidden-stablecoin-risks\/","title":{"rendered":"Nobel Prize Jean Tirole winner warns of hidden stablecoin risks"},"content":{"rendered":"<div class=\"post-detail__content blocks\">\n<p class=\"is-style-lead\">Nobel Prize-winning economist, Jean Tirole, warns retail investors of the hidden risks behind viewing stablecoins as \u201csafe assets\u201d considering it still has insufficient supervision.<\/p>\n<div id=\"cn-block-summary-block_d7e596997b6e46d4d7e7eeb1a9b3659b\" class=\"cn-block-summary\">\n<div class=\"cn-block-summary__nav tabs\">\n        <span class=\"tabs__item is-selected\">Summary<\/span>\n    <\/div>\n<div class=\"cn-block-summary__content\">\n<ul class=\"wp-block-list\">\n<li>Nobel Prize winner Jean Tirole warns that investors may gravitate towards riskier assets if U.S. government bonds fail to perform well.<\/li>\n<li>Stablecoin market cap rose by $16 billion in the past month to $280 billion, according to data from McKinsey.<\/li>\n<\/ul><\/div>\n<\/div>\n<p><!-- .cn-block-summary --><\/p>\n<p>In an <a rel=\"nofollow\" target=\"_blank\" href=\"https:\/\/www.ft.com\/content\/445e7fb6-1ec8-47f3-b74d-87f7960e85d6\" target=\"_blank\">interview<\/a> with Financial Times, 2014 Nobel laureate Jean Tirole warned retail investors that stablecoins could push governments into multibillion-dollar bailouts if the tokens pegged to fiat currencies end up unraveling in the future.<\/p>\n<p>\u201cIf it is held by retail or institutional depositors who thought it was a perfectly safe deposit, then the government will be under a lot of pressure to rescue the depositors so they don\u2019t lose their money,\u201d he said.<\/p>\n<p>Tirole, a professor at the Toulouse School of Economics, warned that as stablecoins are backed by fiat-based assets such as US government bonds, they could end up becoming unpopular because the underlying assets\u2019 offers relatively low yields. The Nobel-prize winner brought up previous instances where the returns were \u201cnegative for a number of years\u201d and payouts after inflation were even lower.<\/p>\n<p>    <!-- .cn-block-related-link --><\/p>\n<p>Stablecoins are currently dominating the financial systems as more governments gravitate towards stablecoin regulations, especially countries like the United States with the Genius Act and Hong Kong with its Stablecoin Ordinance issuers\u2019 license. They are expected to gain further popularity as more governments and institutions are jumping on the bandwagon.<\/p>\n<figure class=\"wp-block-image size-full\"><figcaption class=\"wp-element-caption\">Stablecoin transaction volume for U.S.-pegged tokens | Source: <a rel=\"nofollow\" target=\"_blank\" href=\"https:\/\/www.mckinsey.com\/industries\/financial-services\/our-insights\/the-stable-door-opens-how-tokenized-cash-enables-next-gen-payments\" target=\"_blank\">McKinsey<\/a><\/figcaption><\/figure>\n<p>According to a McKinsey <a rel=\"nofollow\" target=\"_blank\" href=\"https:\/\/www.mckinsey.com\/industries\/financial-services\/our-insights\/the-stable-door-opens-how-tokenized-cash-enables-next-gen-payments\" target=\"_blank\">report<\/a>, the stablecoin market cap recently hit an all-time high of $280 billion. The value increased by $16 billion in the past month alone, with Tether (USDT) leading the charge with 60% of the market cap share.<\/p>\n<p>The stablecoin market is predicted to surpass $400 billion by the end of 2025 and expand as high as $2 trillion by the time 2028 rolls around. <\/p>\n<h2 class=\"wp-block-heading\">Nobel Prize winner worries about reserve asset supervision<\/h2>\n<p>Nobel laureate Jean Tirole said that he was \u201cvery, very worried\u201d about the supervision regarding stablecoins and the risks of depositors going on a run if investors begin to doubt the underlying assets that stablecoins are pegged to.<\/p>\n<p>Although they are now regarded by users as \u201cperfectly safe deposits,\u201d Tirole believes that stablecoins could trigger losses and a possible government-led bailouts. He warned that stablecoin issuers could be attracted to investing in other assets that are riskier and offer higher return.<\/p>\n<p>He stated that higher risks could increase the chances of stablecoin\u2019s reserve asset losing value and triggering a run on the asset. In this case,  he predicted that \u201cthe price of the stablecoins might [also] go down,\u201d as they lost their peg to a sovereign currency.<\/p>\n<p>However, such risks could be mitigated if global supervisors are able to properly regulate digital tokens to make sure the collapse does not happen. Though, Tirole said that in order for the United States to tackle this problem, they must set aside personal financial stakes in cryptocurrency.<\/p>\n<p>\u201cSome key members of the [U.S.] administration\u2009.\u2009.\u2009.\u2009have a personal financial interest in [cryptocurrency]. And beyond the personal interest, there\u2019s ideology,\u201d said Tirole, possibly referring to the Trump family\u2019s various crypto-related projects, including Trump Media\u2019s crypto-backed ETFs and World Liberty Financials\u2019 USD1.<\/p>\n<p>    <!-- .cn-block-related-link --><\/p><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Nobel Prize-winning economist, Jean Tirole, warns retail investors of the hidden risks behind viewing stablecoins as \u201csafe assets\u201d considering it still has insufficient supervision. Summary Nobel Prize winner Jean Tirole&hellip;<\/p>\n","protected":false},"author":1,"featured_media":9394,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-9393","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cryptocurrency"],"_links":{"self":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts\/9393","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/comments?post=9393"}],"version-history":[{"count":1,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts\/9393\/revisions"}],"predecessor-version":[{"id":9395,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts\/9393\/revisions\/9395"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/media\/9394"}],"wp:attachment":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/media?parent=9393"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/categories?post=9393"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/tags?post=9393"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}