Zhu Su Raises Concerns Over Potential Weakening of Stablecoin Demand Due to On-Chain Corporate Bonds

Zhu Su, co-founder of Three Arrows Capital (3AC), stated that the U.S. debt crisis could accelerate the on-chain issuance of corporate bonds and weaken the demand for stablecoins. He argued that investors with idle dollars might prefer interest-bearing corporate bonds over non-yielding stablecoins. Zhu explained that companies could raise funds at lower costs by utilizing on-chain bonds, and if the issuance and distribution processes shift to a blockchain-based model, it would allow for a different method of financing compared to traditional financial intermediaries. He warned that such changes could significantly impact the demand for stablecoins. In particular, in a scenario of dollar weakness, investors might favor Apple corporate bonds yielding 6% over stablecoins with a 0% return. On-chain corporate bonds are structured to record bonds issued by companies in the form of blockchain-based tokens, maintaining credit risk, maturity, and interest conditions, while the holding and transfer methods are processed within a digital asset infrastructure. Zhu's remarks extend the competitive landscape between stablecoins and yield-bearing tokenized assets to corporate bonds. However, this statement is based on a single social media opinion, and further confirmation is needed on whether companies will issue bonds on-chain and whether investors will choose tokenized corporate bonds over stablecoins.

This content is provided for general informational purposes only and doesn't constitute financial, investment, legal, or tax advice. Any events, rewards, online promotions, or related information mentioned herein should not be considered a recommendation, solicitation, or invitation to purchase, sell, trade, or otherwise deal in any crypto assets. Crypto assets are highly volatile and may result in loss. The availability of WEEX services, products, and related events may vary by region. You are responsible for ensuring that your participation is in accordance with applicable local laws and regulations.