Current Status and Future Outlook of Stablecoin Cross-Border Payments

1. Stablecoin Ecosystem

Although stablecoins are still an emerging technology, they have completed the leap from marginal experiments to mainstream visibility in just a few years.

"The changes in the past 18 months have been particularly dramatic," said Chris Mason, co-founder and CEO of B2B stablecoin payment company Orbital. "Those who have been quick to embrace stablecoins are often high-risk, high-growth players in emerging industries; now, the second wave has arrived — payment service providers and traditional banks are collectively awakening."

OpenPayd( fiat currency financial infrastructure provider ) CEO Iana Dimitrova added: "The current explosion is not an overnight success, but rather the result of over 15 years of trial and error and iterative progress. The market has finally reached a consensus on the practical value of stablecoins, and the technology itself has reached a critical point for scalable commercial use."

1.1 A Brief History of Stablecoins

Stablecoins originated with the launch of cryptocurrencies in 2008: a tokenized, decentralized, and tamper-proof digital currency that operates on a blockchain based on distributed ledger technology. Stablecoins were initially born alongside Bitcoin, which was introduced to the world in October 2008 by an anonymous researcher using the pseudonym Satoshi Nakamoto, who published a paper titled "Bitcoin: A Peer-to-Peer Electronic Cash System."

From the very beginning, Bitcoin was positioned as an online payment method that does not require financial intermediaries. Although early adopters conducted some limited payment experiments, it became widely popular among internet natives and technologists speculating with cryptocurrencies. As interest in Bitcoin grew in the coming years, some began to experiment with its underlying technology for cross-border payments. However, due to the extreme volatility of cryptocurrency prices, a lack of regulation, and some association with black market activities, many found it hard to view it as a payment technology.

With the emergence of stablecoins, the situation has changed: stablecoins are a key moment in the development of blockchain technology, and we are currently witnessing its transition from the early internet era to the beginning of the modern digital age.

The first digital currency issued in the form of a stablecoin is BitUSD, which introduced the concept of a 1:1 peg to fiat currency ( referring to the US dollar ) in 2014. However, since it is backed by cryptocurrency, it does not fully meet the definition of stablecoin as we understand it today.

Other companies quickly followed suit, but it was Tether that truly introduced the concept of fiat currency reserves, launching USDT later that year. In the following years, the popularity and attention of USDT continually increased, but it also faced questions regarding transparency and regulation, ultimately leading Tether to take significant measures to address these issues.

In the early development of stablecoins, developers were gradually understanding the meaning of stablecoins and their usage. In 2018, more regulated stablecoins began to emerge, with Paxos launching the current Pax Dollar (USDP) and Circle launching USD Coin (USDC) through its alliance with Coinbase. These regulated, US-based stablecoins became increasingly popular, attracting interest not only from the cryptocurrency field but also from the mainstream financial industry. Meanwhile, participants in the financial infrastructure built on stablecoins also began to emerge, including Fireblocks in 2018 and BVNK in 2021.

However, in 2022 and early 2023, stablecoins faced a significant trust crisis, marked by several shocking events in the industry. The first was the sudden crash of TerraUSD(UST). This is an unconventional algorithmic stablecoin, whose support mechanism is not cash reserves, but based on an algorithmic mechanism. When its value significantly dropped from the pegged exchange rate of 1 USD, panic trading triggered by the "death spiral" also caused the values of several other stablecoins to fluctuate temporarily in the major markets. Although UST is not a stablecoin in the traditional sense, and Circle, Paxos, and other companies have tried to distance themselves from algorithmic stablecoins, the damage it caused to the reputation of the entire industry is still significant.

Despite many participants claiming that their asset reserves could protect them from the above issues and provide them with peace of mind, the collapse of Silicon Valley Bank (SVB) in early 2023 raised new concerns. At the time of the collapse, Circle's reserves at Silicon Valley Bank (SVB) were approximately $3.3 billion, and there was uncertainty about whether these deposits would be protected. This triggered what is known as a "shadow bank run," as holders feared they would not be able to redeem the stablecoin at a 1:1 price, causing its trading value to plummet to historic lows. Although the U.S. government ultimately did guarantee Silicon Valley Bank's reserves, and Circle never faced a true risk of being unable to redeem its USDC, the reputational damage was more severe, especially for institutions that needed to hold U.S. reserves and have strong backing for their stablecoins.

During this crisis, the adoption rate of USDT overseas has continued to rise, while the circulating supply of USDC in the United States has steadily declined during 2023. As a result, a streamlined and more robust industry version has begun to slowly emerge from the ashes of this crisis. Driven by genuine demand in key channels and vertical industries, the trading volume and adoption rate of infrastructure companies have been continuously climbing, and products have been correspondingly improved; while other companies have launched products focused on the true utility of their technology. In the second half of 2023, PayPal launched PayPal USD (PYUSD), casting a crucial vote of confidence for the industry; while other companies are committed to educating those who are uncertain about stablecoins to establish a regulatory framework and increase adoption rates. Orbital CEO Mason stated: "The educational work is indeed difficult, but people are really starting to understand it."

Starting from early 2024, the circulating supply of USDC has once again increased, with the number of newly issued tokens focused on payments also continuing to grow. Recently, Trump's return to the U.S. presidency has also increased institutional support for the technology, accompanied by regulatory measures such as the "GENIUS Act."

Today, with the rapid rise in adoption, the cross-border payment industry has also shown a strong interest, and there is further room for growth in the future. However, the fundamental principles of stablecoins are roughly the same as the premises originally set by Satoshi Nakamoto in the Bitcoin whitepaper.

( 1.2 Interest in stablecoins is growing in the field of cross-border payments.

With the rise of stablecoin technology, its application cases in the cross-border payment field are gradually increasing. As Paxos's Kendall explained, although the current use of stablecoins is still mainly concentrated on "cryptocurrency activities", the interest in this area is continuously growing, largely driven by the most fundamental needs of end users.

This experience is reflected in many companies in the field, including Conduit, which focuses on B2B inter-company payments. However, in the past year or two, the situation has begun to change.

Such requests mainly come from businesses with global trade needs, but the adoption of stablecoins in other aspects of cross-border payments is also continuously increasing, including MoneyGram, which has started to offer stablecoin payment functionality. In 2022, MoneyGram began sending remittances using USDC, and since then, its business capabilities in this field have been continuously expanding, including the launch of the white-label digital wallet's deposit and withdrawal solution, MoneyGram Ramps, as well as meeting its own cross-border fund management needs.

Today, although the share of stablecoins in the market is very small, their attention has clearly increased. In the first half of 2025, the number of press releases related to stablecoins and payments grew by 186% compared to the same period last year, a growth rate that exceeded the previous overall growth rate of stablecoin press releases, and the number of press releases involving cross-border payments and stablecoins surged by more than 1000%. And this is just the companies that have publicly launched stablecoin solutions.

According to BVNK Harmse, the vast majority of companies in the payment industry have seen the opportunities brought by this technology, even if they have not publicly discussed it. "I think 95% of companies have seen this," he said, "Based on the conversations we are having and potential collaborations, there are indeed many traditional payment companies actively investing, including some you originally thought would not invest."

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( 1.3 Stablecoin payment investment surge

In addition to the strong interest from established companies, capital continues to increase. Although the overall venture capital environment is cooling, the stablecoin sector is still attracting funds, with a large number of projects announcing financing in the past year.

At the same time, a series of mergers and acquisitions are accelerating: traditional giants hope to quickly enhance their capabilities in this field through acquisitions. Despite the frequent actions, Stripe's acquisition of the stablecoin infrastructure company Bridge, announced in 2024 and completed in early 2025, is still widely regarded as a catalyst for the entire industry to "seriously embrace this technology."

BVNK's Harmse stated: "It forces everyone to reassess this track. We were already in talks with several top global payment companies, and this acquisition has directly accelerated the pace of the discussions by several times."

According to Jack Zhang, co-founder and CEO of Airwallex, the significance of Stripe's move goes beyond this: "Stripe is a master storyteller. With this acquisition, they created a super brand story, truly bringing stablecoins into the spotlight, and one could even say it has propelled the formation of today's stablecoin craze."

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2. The Current Status of Stablecoin in Cross-Border Payments

The underlying logic of stablecoin payments is very simple: theoretically, it outperforms existing mainstream solutions in multiple dimensions ( speed, reliability, and transparency ). Although there is still room for optimization in terms of costs ( for deposits and withdrawals ), this depends on further improvements in liquidity.

However, reality is not all glamorous. Despite the increasing number of successful cases, stablecoin payments still face many complex steps when being implemented; the overall scale of payment scenarios is relatively small, which means that some capabilities are still in the verification stage.

Therefore, the true value of stablecoins is reflected in scenarios that can "effectively and reliably improve the existing payment experience." At least for now, this improvement is most concentrated in emerging markets.

( 2.1 Emerging Markets: The "Main Battlefield" of Stablecoins

Whether it is early-stage payment infrastructure companies betting on stablecoins or new players who have only recently entered the market, the viewpoint is surprisingly consistent: in countries where traditional payment systems are weak, stablecoins are not only the "best solution available now" but also the driving force behind the emergence of the entire "stablecoin cross-border payment" track.

Dimitrova from OpenPayd stated: "Global e-commerce platforms have long felt the pain points of collecting, lending, and retaining funds in underdeveloped countries. They have been quietly searching for alternatives in the background, but only now are traditional financial institutions realizing this."

The pain points of the target audience not only want to "move funds in and out cheaply and quickly", but also include: enterprises that find it difficult to obtain internationally usable payment tools; institutions and individuals deeply trapped in the quagmire of local currency fluctuations.

However, the demand in emerging markets is not uniform; the outbreak of one scenario can give rise to more scenarios, with demand expanding layer by layer. What is certain is that a considerable and still expanding market has formed with a significant amount of cross-border capital flowing through "niche channels." Stablecoin players are flocking in, and the customer profile is becoming increasingly "sophisticated."

Gertman from Conduit said: "We are serving an airline that needs to collect payments in multiple countries in Africa and then remit them back to their headquarters in Europe. As long as they quickly figure out the use case, they will immediately test it out."

Not only is the client "upgrading", but local partners are also increasing.