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สถาบันวิจัยเศรษฐกิจป๋วย อึ๊งภากรณ์
Puey Ungphakorn
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Call for Papers: PIER Research Workshop 2025
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Discussion Paperdp
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Year
2025
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29 July 2021
20211627516800000
No. 156

Where Do DeFi Stablecoins Go? A Closer Look at What DeFi Composability Really Means

Abstract

One of the benefits of decentralized finance (DeFi) – an alternative financial system built on blockchain – is composability, which means the system's building blocks (tokens) can freely interact with one another to form new services. One example is stablecoin, a token with fixed exchange rate, which is backed by token collaterals. While stablecoins can be used to facilitate payments and exchanges, in DeFi they can be used to earn returns (“yield farming”), potentially multiplicatively. We use transaction-level blockchain data to analyze a stablecoin's flows between protocols and provide suggestive evidence of DeFi yield-chasing behavior. We shed light on what DeFi total value locked might really measure and highlight the complexity in DeFi analysis and market surveillance.

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JEL: E00G00
Tags: defistablecointotal value lockedyield farmingsystemic risk
The views expressed in this workshop do not necessarily reflect the views of the Puey Ungphakorn Institute for Economic Research or the Bank of Thailand.
Kanis Saengchote
Kanis Saengchote
Chulalongkorn University

Puey Ungphakorn Institute for Economic Research

273 Samsen Rd, Phra Nakhon, Bangkok 10200

Phone: 0-2283-6066

Email: pier@bot.or.th

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