Eurodollar
유로달러
U.S. dollar-denominated deposits held at banks outside the United States. The market originated in 1957 when the Soviet Union, fearing asset freezes after the Hungarian Revolution, transferred dollar holdings to the Moscow Narodny Bank in London. It subsequently exploded into a vast offshore dollar market that circumvented U.S. banking regulations: reserve requirements, deposit insurance assessments, and interest-rate ceilings. The Eurodollar market sustained and expanded the dollar's global reserve-currency role well beyond the Bretton Woods system; the rise of stablecoins in the 2020s is widely understood as its on-chain digital extension.
Sources
- Wikipedia (EN) definition, Soviet/Cold War origin story (Moscow Narodny Bank, BCEN/Eurobank telex, 1957 first transfer), regulatory arbitrage mechanics, market size and decline after 2020
- pbs.org detailed first-hand account of the Soviet origin: Russian bureaucrat moved dollar balances to Moscow Narodny Bank in London after 1956 Hungarian revolt, first $800,000 loan on 28 February 1957, BCEN telex address 'Eurobank' giving the market its name, regulatory evasion driving growth
- richmondfed.org Richmond Fed definition, regulatory structure, Eurodollar as dollar deposits free of U.S. reserve requirements and deposit insurance, growth through regulatory cost avoidance