Stablecoins are gaining traction among institutional investors as a hedge against Bitcoin's volatility, with allocations reaching 5% to 10% of portfolios. This trend is driven by Bitcoin's high annualized volatility of approximately 55%. Regulatory developments, including the Genius Act and the EU's MiCA framework, have enhanced confidence in stablecoins like USDC and USD. Despite this, the 2023 USDC de-pegging incident has underscored the need for improved risk management and issuer credibility.