Analysis Of Stablecoin Performance As An Alternative Store Of Value Compared To Gold

Abstract

Stablecoins are crypto assets designed to maintain a stable value against a fiat currency, and they are increasingly promoted as a digital store of value. This study compares the three largest US dollar stablecoins, USDT, USDC, and DAI, with gold as a store of value for Indonesian investors over the period from 1 January 2020 to 30 June 2026. Store of value performance is assessed along three dimensions: short term price stability, preservation of purchasing power, and protection during market stress. The analysis covers peg deviations and depeg episodes, nominal and inflation adjusted returns in both US dollar and rupiah terms, holding period analysis, and hedge and safe haven regressions against Indonesian stocks and Bitcoin. The results show that stablecoins are far more stable than gold in the short run, with an average absolute deviation from their peg of 17.3 basis points and deviations above 1% on fewer than 1% of days. However, they are exposed to sudden depegs, such as the fall of USDC to 0.877 US dollars after the failure of Silicon Valley Bank, and they lose purchasing power steadily: in US dollar terms their real value fell by about 3.8% per year, and in rupiah terms the depreciation of the rupiah only roughly offset Indonesian inflation. Gold, although much more volatile, preserved and increased purchasing power, with an annual real return of 13.8% in rupiah and no real loss over any three year holding period in US dollars. Both assets acted as hedges against Indonesian stocks in rupiah terms, and stablecoins were also a safe haven against Bitcoin. Stablecoins are therefore better suited as a short term store of liquidity and a refuge within the crypto market, whereas gold remains the better long term store of value.