June 10, 2025
Stablecoins are quietly changing the financial world. Unlike traditional cryptocurrencies known for wild price swings, stablecoins offer digital tokens designed to maintain steady value by being tied to real-world assets like the U.S. dollar or other reserves. This unique feature has made them increasingly attractive, not just for crypto enthusiasts but for banks, fintech companies, and big corporations exploring new ways to manage money and payments.
Over the past three months alone, stablecoins have recorded nearly $10 trillion in transaction volume on public blockchains, highlighting their growing use in everyday financial activities. As stablecoins continue to gain traction, they are bridging the gap between the traditional banking system and the digital economy.
In this blog, we'll discuss the latest trends in stablecoin usage, explore the leading players in the market, review regulatory developments, examine real-world applications, and discuss the potential impact stablecoins might have on the future of finance.
What Are Stablecoins and Why Do They Matter?
Stablecoins first appeared around 2014 as an answer to the volatility problem in cryptocurrencies. They are digital tokens that maintain a steady value by being pegged and backed, usually one-to-one, by assets such as fiat currencies (like the U.S. dollar or euro), commodities (like gold), or even other cryptocurrencies. Some stablecoins also use algorithms to manage supply and demand, keeping their price steady without holding reserves.
Over the years, stablecoins have grown from niche crypto tools into a vital part of the digital financial ecosystem. By 2025, their total market capitalization is estimated to be around $208 billion, signaling significant growth and adoption.
Stablecoins serve multiple purposes: they act as a store of value for investors looking to avoid market swings, a reliable trading pair in the crypto markets, and increasingly, as a payment method enabling faster, cheaper transactions. Their ability to facilitate cross-border payments quickly and cost-effectively makes them an essential tool in global finance.
Recent Trends in Stablecoin Usage
The use of stablecoins has grown steadily year over year, with the supply increasing by roughly 28% annually. Transfer volumes are staggering—last year alone, they topped $27.6 trillion, surpassing the combined transaction volume of payment giants like Visa and Mastercard.
While stablecoins have primarily been used within crypto trading markets, their utility is expanding rapidly. More companies and financial institutions are exploring stablecoins for corporate treasury management, remittances, and cross-border payments.
Geographically, stablecoin adoption shows clear patterns. For example, USD Coin (USDC) is predominantly used in North America, while Tether (USDT) holds sway across Asia and Europe. This reflects regional preferences and regulatory environments.
Stablecoins are also moving beyond speculation, with banks and fintech firms such as JPMorgan, PayPal, and Standard Chartered actively launching or piloting stablecoin projects. This shift from crypto traders to mainstream financial players highlights the growing maturity and acceptance of stablecoins in everyday finance.
What are the Leading Stablecoins in the Market?
Several stablecoins have emerged as leaders, each with distinct features and market reach:
Tether (USDT)
Market Cap: $154.85 billion (June 2025)
Widest Blockchain Coverage: Available on over a dozen blockchains including Ethereum, Tron, Solana, and more, making it highly versatile for users worldwide.
Largest Market Liquidity Provider: Tether dominates crypto trading pairs, supplying liquidity that supports over 70% of stablecoin trading volume globally.
Diverse Asset Backing: Beyond USD reserves, Tether holds Bitcoin and gold assets to diversify risk and enhance stability.
USD Coin (USDC)
Market Cap: $61.04 billion (June 2025)
Regular Third-Party Audits: Circle provides monthly public reserve attestations, setting a transparency standard few stablecoins match.
Designed for Institutional Use: USDC is the preferred stablecoin for major payment platforms, banks, and fintechs like Coinbase and Visa integration.
Multi-Chain Expansion Strategy: Apart from Ethereum, USDC launched on Algorand, Solana, and Avalanche, enhancing speed and reducing fees for users.
PayPal USD (PYUSD)
Market Cap: $981.95 million (June 2025)
First Major Payment Provider-Backed Stablecoin: PYUSD is the first stablecoin issued by a globally trusted payment platform, driving mainstream adoption.
Multi-Asset Backing with High Liquidity: Fully collateralized with a blend of cash, short-term Treasuries, and cash equivalents to ensure liquidity and stability.
Cross-Chain and Platform Partnerships: Launched on Solana blockchain and integrated with Crypto.com and Phantom wallet to offer seamless user access and rewards.
Pax Dollar (USDP)
Market Cap: $73.25 million (June 2025)
Regulated Trust Company Issuer: Paxos is a New York State-regulated trust, giving USDP a compliance edge for institutional investors and financial firms.
Built for Institutional Treasury: USDP offers features designed for corporate liquidity management, including faster settlement and regulatory reporting.
Supports PayPal’s PYUSD: USDP’s infrastructure powers PayPal’s stablecoin, bringing strong regulatory oversight into mainstream digital payments.
Recent collaborations between these stablecoins and financial institutions are notable. For instance, BNY Mellon’s partnership with Circle enables direct creation and redemption of USDC through bank clients, marking a key step in integrating stablecoins with traditional finance.
Regulatory Landscape for Stablecoins: Key Bills and Developments
Until now, stablecoins in the U.S. have operated under a patchwork of state laws, mostly governed by money transmitter rules that vary widely from place to place. Some states, like New York, California, and Arkansas, have introduced specific regulations for stablecoin issuance and custody. On the federal level, there’s been uncertainty about how stablecoins fit within securities laws. However, federal banking regulators have recently started to regulate a bit more, signaling a more open stance toward stablecoins.
Two important bills aim to bring clarity and consistent rules: the GENIUS Act, introduced in 2025, and the STABLE Act, originally proposed in 2020 and still evolving. Both laws focus on who can issue payment stablecoins, generally limiting this to trusted entities like bank subsidiaries or those chartered by federal regulators such as the Office of the Comptroller of the Currency (OCC). They also set clear standards for backing stablecoins with reserves, enforcing transparency, ensuring compliance with anti-money laundering laws, and providing protections in case of issuer insolvency.
The GENIUS Act defines a payment stablecoin as a digital asset intended for payments, which must maintain a stable value tied to a fixed monetary amount. It excludes things like national currencies or certain investment securities. The STABLE Act has a similar definition but adds details, including that stablecoins must be denominated in a national currency and clarifies what counts as tokenized deposits or securities.
Importantly, both bills leave room for banks to issue tokenized deposits without being subject to these new stablecoin regulations. The STABLE Act also forbids paying interest on stablecoins held by individuals, a move aimed at protecting financial stability and avoiding competition with traditional bank deposits.
Together, these proposed laws aim to clear up confusion and create a safer, more trustworthy environment for stablecoins. This could encourage more banks and businesses to offer stablecoin services confidently while keeping consumer protections front and center.
Why Businesses Use Stablecoins for Payments and Treasury?
Stablecoins have moved beyond the crypto trading scene to become valuable tools for banks, fintech firms, and corporations. Their ability to improve efficiency and reduce costs in traditional financial processes is gaining widespread recognition.
Stablecoins Revolutionizing Cross-Border Payments
Cross-border payments are slow and expensive due to multiple intermediaries and regulatory complexities. Stablecoins offer a faster, more cost-effective alternative by enabling near-instant settlement on blockchain networks. For instance, USD Coin (USDC) transfers on the Solana blockchain typically cost less than $0.01 and settle within seconds, compared to traditional cross-border payments that can take several days and involve high transaction fees. This efficiency is particularly important for businesses with frequent international transactions and remittances.
Providing Currency Stability in Inflationary Economies
In countries facing high inflation and currency volatility, such as Argentina, stablecoins serve as a reliable store of value and medium of exchange. By converting unstable local currencies into USD-backed stablecoins, businesses and individuals protect their purchasing power and facilitate trade without relying on traditional banking infrastructure, which may be limited or unstable. This function supports financial inclusion and economic resilience in emerging markets.
Programmable Treasury and Automated Corporate Payments
Stablecoins also enable programmable money through smart contracts, automating complex financial operations. JPMorgan’s JPM Coin, a USD-backed stablecoin designed for institutional use, exemplifies this by triggering payments automatically based on predefined real-world events—such as production milestones or fuel deliveries. This automation reduces manual intervention, speeds up transactions, minimizes errors, and improves cash flow management for corporate treasuries.
The Role of Banks in Stablecoin Custody and Compliance
Banks are increasingly acting as trusted custodians of stablecoins, providing secure storage and regulatory compliance services. Their involvement simplifies stablecoin adoption for businesses by offering familiar onboarding processes, anti-money laundering (AML) and know-your-customer (KYC) compliance, and integration with existing financial systems. Institutions like BNY Mellon and Standard Chartered have partnered with stablecoin issuers to facilitate these services, bridging the gap between traditional finance and digital assets.
Key Risks and Challenges with Stablecoins
Despite their benefits, stablecoins carry risks that must be carefully managed:
Security Risks: Holding and managing stablecoins involves protecting digital wallets and reserves from hacks, theft, or technical failures. For example, centralized exchanges and custodians have suffered high-profile breaches that resulted in millions lost.
Compliance and Regulatory Challenges: The transparency of blockchain transactions is a double-edged sword. Although transactions are publicly recorded, tracing the real-world identities behind these transfers can be difficult. This makes enforcing anti-money laundering (AML) and know-your-customer (KYC) rules complex.
Issuer and Centralization Risks: Most stablecoins are managed by centralized organizations that control reserves and redemption policies. This introduces counterparty risk, where the issuer might freeze funds, mismanage reserves, or face regulatory sanctions. Tether (USDT) faced significant scrutiny over its reserve backing transparency, and similar concerns have shaken user confidence in some stablecoin projects.
De-Pegging and Market Risks: Stablecoins depend on maintaining a fixed peg to an asset, but this peg can break in stressful market conditions. The collapse of TerraUSD (UST) in 2022 is a stark reminder of the dangers. Algorithmic stablecoins, which rely on complex supply controls instead of reserves, have shown particular vulnerability, resulting in sharp losses for investors.
Smart Contract Vulnerabilities: Crypto-backed and algorithmic stablecoins depend on code to maintain stability. However, bugs or exploits in smart contracts can lead to unexpected behavior or loss of funds. Without thorough third-party audits, these vulnerabilities remain a serious concern.
Transparency Concerns: Some issuers have been criticized for not providing clear, regular audits of their reserves, which undermines trust. Without verified transparency, users cannot be certain stablecoins are fully backed, leading to market instability.
User Adoption Hurdles: Managing wallets, private keys, and understanding blockchain tech can be intimidating for everyday users. This complexity slows widespread adoption, especially among non-technical consumers and those unfamiliar with crypto.
Limited Investment Upside: Unlike volatile cryptocurrencies, stablecoins typically do not appreciate in value. They are designed as stable stores of value or mediums of exchange, meaning investors looking for capital gains may find them less attractive.
Clear regulation, industry best practices, and ongoing education are vital to overcoming these challenges.
Also Read: Exploring Low-Risk, High-Potential Cryptocurrencies in Spot Trading
Potential Impact on Financial Systems
Stablecoins could redefine how money moves globally:
They offer faster, cheaper payments and settlements compared to the existing infrastructure.
They introduce new competition for traditional payment networks and foreign exchange services.
They enable new financial products and programmable money that can automate business processes.
As banks, fintechs, and corporates embrace stablecoins, the financial ecosystem will evolve towards a more integrated digital future.
The long-term outlook suggests stablecoins will become a foundational technology, complementing traditional finance and expanding global economic participation.
SperaxDAO: A New Way to Earn with Stablecoins
SperaxDAO is a decentralized platform that offers a stablecoin yield aggregator called USDs, which is fully backed to keep its value steady. It helps both everyday investors and institutions earn passive income easily.
By holding USDs in their wallets, users can earn rewards automatically without extra steps. They can also stake SperaxDAO’s token, SPA, to earn more rewards and have a say in how the platform runs. SperaxDAO also lets people earn by providing liquidity through DeFi farming, where users get returns from transaction fees and new tokens.
OptiFAI is an AI-powered system that further enhances earnings by automatically selecting the best strategies in DeFi to maximize profits. By managing assets with minimal user involvement, OptiFAI ensures optimal yield opportunities are discovered and leveraged. With a focus on cross-chain yield optimization and smart contract security, OptiFAI works seamlessly within SperaxDAO’s platform to help users get more from their crypto with intelligent, AI-driven strategies.
Wrapping Up
Stablecoins are steadily moving from the fringes of crypto to the center of global finance. Their ability to combine digital efficiency with price stability makes them invaluable in a world demanding faster, cheaper, and more inclusive financial services. With regulation finally catching up and banks stepping into the arena, stablecoins are poised to change how we send, spend, and store money.
As stablecoins become a key part of digital finance, finding reliable and easy ways to earn from them is crucial. Start earning passive income effortlessly with SperaxDAO’s USDs. Whether you’re new to DeFi or experienced, SperaxDAO simplifies managing and growing your digital assets. Get started today!
FAQs
Is Bitcoin a stablecoin?
No, Bitcoin is not a stablecoin. It serves as a digital store of value with price volatility, unlike stablecoins, which are designed to maintain a consistent value pegged to fiat currencies like the US dollar.
Is Ethereum a stablecoin?
Ethereum is not a stablecoin. It is a volatile cryptocurrency used for decentralized applications and smart contracts, whereas stablecoins are pegged to traditional currencies like the US dollar to maintain price stability.
Is it worth buying Ethereum now?
Ethereum has experienced significant price changes, making it a volatile investment. Potential buyers should carefully consider market conditions and risks before investing.
What kind of coin is XRP?
XRP is a cryptocurrency developed by Ripple Labs, designed primarily to improve cross-border payment efficiency for banks and financial institutions. It serves as a bridge currency in Ripple’s payment network.
Will Tesla accept Dogecoin?
Tesla currently only accepts Dogecoin as payment for certain products. Other cryptocurrencies are not accepted for purchases by Tesla. Always ensure you use Dogecoin when making payments to Tesla.