Stablecoin adoption remains under 1% but behind a developing infrastructure and increased regulatory scrutiny lies a financial tug of war between private innovation and public control. Payment Expert Editor Rachael Kennedy reports.
This article first appeared in the September 2025 edition of SBC Leaders Magazine.
Stablecoins may have processed over $7 trillion in transactions last year, but according to global payouts platform Remote and payments giant Stripe, their actual usage among businesses remains under 1%. At first glance, this appears to be a contradiction. Why is so much money and infrastructure flowing into a product with such low adoption?
Behind the headline figures lies a different story: stablecoins are quietly becoming indispensable for specific segments of the global economy. And so the question is no longer whether they work but whether they cn scale, securely and compliantly, beyond their current niche.
Real-world traction in the margins
In regions where local currencies are volatile, infrastructure is patchy, and access to US dollars is limited, stablecoins are finding real, if quiet, traction. Remote, a Dutch-headquartered payroll platform, now enables contractors in countries such as Argentina, Nigeria, and the Philippines to receive payments in USD Coin (USDC). Its CEO Job van der Voort says that for many workers, “it’s actually amazing to use stablecoins”, describing it as a first step toward broader digital finance inclusion.
Visa is also pushing boundaries in Africa through its partnership with crypto-native fintech Yellow Card. The collaboration allows USDC to be used for cross-border merchant payments in 30 countries; a way to bypass slow, dollar-reliant correspondent banking. Yellow Card now claims to handle around 90% of its operations through stablecoins.
Stripe, meanwhile, has made a billion-dollar bet on this frontier. With the acquisition of Bridge, a stablecoin infrastructure firm, it now offers multi-currency wallets, instant settlements, and even USDC-backed Visa cards for businesses in emerging markets. The promise is programmable dollars that can move 24/7, settle in seconds, and reach places that traditional rails overlook.
As digital trade becomes increasingly borderless, stablecoins are starting to meet users where the banking system cannot.
The friction behind the hype
Despite compelling use cases, the vast majority of businesses and consumers remain on the sidelines. “Adoption is still under 1%, but growing fast,” notes Stripe’s Head of MaaS Neetika Bansa. Remote’s CEO echoed the same figure for global contractor payouts suggesting that while the tech works, usage is still very much at the experimental stage.
There are several reasons. First, the average consumer has limited access to stablecoins without venturing through crypto exchanges, which can be off-putting. For businesses, integrating stablecoin infrastructure still requires legal due diligence, custody considerations, and local compliance sign-off. Not all stablecoins are created equal, and questions persist around transparency, auditability, and redemption guarantees.
Moreover, regulatory uncertainty, particularly in the UK and US, continues to cause hesitation. Without consistent standards across borders, financial institutions are reluctant to scale products that could be deemed non-compliant in key markets overnight.
Infrastructure is here
While end-user adoption may be slow, the infrastructure surrounding stablecoins is anything but. Behind the scenes, a growing number of providers are embedding stablecoin functionality into business payment stacks, particularly for B2B, treasury and platform use cases.
Stripe’s Bridge platform now supports stablecoin-backed card issuance across 12 countries via a single API. The company also facilitates stablecoin settlements for online marketplaces, SaaS platforms and remote payroll operations. According to Bansal, the vision is for stablecoins to become “invisible to the user,” simply powering faster and more flexible money movement.
Visa and Mastercard are both running stablecoin pilots, with Visa notably supporting USDC for on-chain settlement in partnership with Circle. Fireblocks, a leading custody and payments infrastructure provider, claims that a growing share of its B2B clients are settling global treasury flows via stablecoins, citing use cases such as SpaceX, which reportedly uses stablecoins to manage revenues from its Starlink satellite broadband service in Argentina and other high-inflation economies.
According to recent data, monthly stablecoin transaction volumes now exceed $700 billion. While not all of this volume translates into commercial utility, the direction of travel is clear: major financial players are preparing for a future in which digital dollars circulate as freely as physical ones.
Regulation rising
The stablecoin ecosystem’s legitimacy increasingly depends on regulatory clarity and 2025 has already delivered several landmark developments.
In the UK, the Financial Conduct Authority (FCA) released proposed rules in May 2025, covering issuance, custody, and redemption. Issuers will need to meet capital thresholds and guarantee one-to-one redemption in fiat. The FCA also confirmed that only stablecoins pegged to fiat and backed by high-quality liquid assets will be permitted for use in payment systems. Industry groups have cautiously welcomed the proposals, citing long-awaited clarity as a critical step toward broader adoption.
Across the Channel, the EU’s Markets in Crypto-Assets (MiCA) regulation is now in force, establishing one of the most comprehensive frameworks globally. MiCA includes strict disclosure and reserve requirements for stablecoins, particularly those designated as “significant”.
The framework is already being put to the test. In July 2025, AllUnity became the first issuer to receive approval from Germany’s BaFin under MiCA to launch EURAU, a euro-backed stablecoin. Jointly developed by DWS, Flow Traders and Galaxy, EURAU is fully collateralised and designed to offer 24/7 euro liquidity for institutional-grade cross-border settlements. The move is widely seen as a proof-of-concept for how compliant stablecoins can operate within — rather than outside — the European financial system.
Meanwhile, the European Central Bank has escalated its response. ECB President Christine Lagarde told lawmakers that stablecoins pose risks to monetary policy, financial stability, and public trust. She singled out Tether for its lack of oversight, and warned of stablecoins’ potential to draw deposits away from the banking system, undermining interest rate transmission.
The Bank for International Settlements (BIS) echoed her concerns, warning that most stablecoins fail the fundamental tests of monetary integrity, including singleness, elasticity and AML compliance. In its recent report, the BIS cast doubt on their long-term suitability as instruments of value or exchange.
To address these challenges, the ECB has launched two infrastructure pilots – Pontes and Appia – aimed at enabling settlement of DLT transactions in central bank money. Pontes will link DLT platforms to existing infrastructure, while Appia will build a native, long-term DLT settlement ecosystem for Europe. Both are part of a broader effort to futureproof monetary sovereignty through programmable, public money.
Sceptics still loud
For all the infrastructure momentum, criticism remains sharp. Nobel laureate Paul Krugman has stood among the most vocal detractors. In a recent blog post, he warned stablecoins offer “nothing you can do more cheaply and easily” than existing digital tools, condemning their anonymity and alleging that “the only economic reason for stablecoins is to facilitate criminal activity”.
Central banks, particularly in Brazil and South Korea, have also issued caution. Brazil’s deputy governor, Renato Gomes, said stablecoins are “stoking volatility in capital flows”, with dollar-backed tokens now representing about 90 % of crypto activity in the country. South Korea’s central bank governor, Rhee Chang‑yong, voiced concerns that won‑based tokens could undermine foreign exchange stability.
And from a macro‑prudential angle, the BIS warns that concentrated reserve holdings by stablecoin issuers could impair central banks’ control over interest rates and liquidity . Its latest report adds that the lack of robust AML/KYC controls makes stablecoins attractive for illicit finance, particularly those issued or transacted through decentralised, unhosted wallets.
As regulatory lines sharpen and infrastructure deepens, the battle over digital money is becoming a question of trust.
Will programmable payments be governed by public institutions or left to private actors? And is coexistence – through compliant stablecoins like EURAU or public-private settlement platforms – the realistic middle ground?
