Odaily Planet Daily News: The European Central Bank (ECB) has questioned the view that stablecoins are a "safe haven" for investors in times of market turmoil, arguing that they are actually highly affected by US monetary policy. The working paper examines the connection between US monetary policy, money market funds (MMFs) and stablecoins. "Monetary policy, especially US dollar policy, is key to connecting cryptocurrencies and traditional financial markets," the authors concluded. The article points out that stablecoins have fixed prices and are usually pegged to fiat currencies (usually the US dollar), making them vulnerable to shocks from traditional financial markets, such as changes in US monetary policy, such as interest rate hikes. The ECB evaluated data from 2019 and said that the US government's interest rate hikes caused the market value of stablecoins to fall by 10% in the next 12 weeks. At the same time, it found that traditional non-crypto assets, such as money market funds, actually received a large influx of new capital during the same period. (Decrypt)