A recent survey of managers across multiple countries found that the majority are developing strategies for stablecoin use, with common goals including accessing decentralized finance (DeFi) opportunities, diversifying investments, and leveraging faster, lower-cost transactions.
Stablecoins, or digital assets designed to maintain a stable value, offer insurers the ability to diversify investment portfolios while maintaining relative stability compared with traditional cryptocurrencies. They may also provide more efficient mechanisms for liquidity management, including cross-border premium collection, claims payouts, and reinsurance settlements. By providing a more predictable digital asset, stablecoins can help insurers manage cash flow in increasingly globalised markets, where timeliness and security of funds are critical.
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