Inflation as the first mover
Most of the world does not have access to a stable currency. If you live in a country like Argentina or Turkey, most of the money that you store will lose at least half of its value in a year. The reality is that most of the world does not have access to a fiat currency with stability, as the U.S. does.
When given the option, most citizens tend to save their money in trusted currencies where governments are more stable. We are starting to see a few nations moving to the dollar and Bitcoin. This includes El Salvador, and now Argentina. But if the digital world can shift to dollars, people will move their wealth to more stable currencies.
Incentives for issuance of stablecoins
Circle and Tether are the largest issuers of stablecoins, controlling the issuance of both USDC and USDT. Stablecoins are a form of IOU, and the banks issuing them can make money by, for example, investing in short-term US Treasuries. Recognizing this opportunity, other companies like PayPal will start issuing their stablecoins. The competition will intensify, but the biggest winners in this scenario will be consumers around the world.
Programmable and permissionless money
Stablecoins differ from traditional analog money. They can be programmed. You can use them within smart contracts, and there is a way to verify that a wallet has a certain amount of money attached to the account. Lending and borrowing become easier and more predictable. The lending and borrowing processes become borderless.
Before the introduction of stablecoins, users had their money locked to a specific company. For example, if you had money on Venmo, it would take 3 days for someone to cash out their funds to their bank account, which could then be transferred elsewhere.
Stablecoins allow users to transfer their money from one platform to another as fast as a transaction goes through a crypto network.
Access to capital
Most of the world doesn't have cheap access to capital. One of the significant differences between living in developed nations and developing nations is that access to capital is much easier in developed nations, partly because capital is more expensive in developing nations due to their higher interest rates.
With the unlocking of stablecoins, access to capital becomes borderless, and therefore, the development of businesses is less dependent on the region where they operate.
The world is evolving. The transition to stablecoins will be swift, followed by a move towards Bitcoin.