Who Will Win The Stablecoin Wars?

History Says the Winner Isn’t Here Yet

Photo by CoinWire Japan on Unsplash

They say history doesn’t repeat; it rhymes. However, the Stablecoin Wars of the 2020s don’t just share syllables with the past, or even lines, but entire verses.

Sixty-something years ago, a dynamic was unfolding between US banks that bears an eerily similar dynamic to that being played out between Stablecoins and their issuers today. It revolved around the same medium of exchange (US Dollar) and exhibited the same pattern of fragmentation that we see today.

It will result in the exact same outcome.

Bank To The Future

In the 1950s and 60s, American banks were experimenting with a new idea: Credit Cards. Seeing the relative success of company “charge plates” like Diners Club, Banks saw themselves as the perfect vendor for general-purpose spending cards.

Bank of America’s BankAmericard was the first general-purpose dollar card, famously piloted in Fresno, California. The premise was simple: If you bank with us, you can have a card. You can spend this card at any merchant that also banks with us.

Settlements on the card network were clunky and manual. Merchants authorized transactions by physically calling banks or flipping through printed “hot card” lists for…