Stablecoins are shaping a new digital financial infrastructure

Stablecoins are transforming from tools of cryptocurrency speculation into a new type of digital financial infrastructure. As of August 2025, the total market capitalization of stablecoins has surpassed 270 billion dollars, but the differentiation in their composition, revenue mechanisms, and application scenarios is more significant than their scale.

The market is undergoing a decisive transformation: from purely liquidity-seeking dollar tokens to composable, yield-generating settlement assets that are directly connected to the cash flows of the real economy and corporate systems. Let us delve into the evolution of stablecoin types and global regulatory dynamics.

The market size of stablecoins continues to expand

Stablecoins have broken through the limitations of the cryptocurrency space. The growth in supply is primarily driven by USDT, USDC, and emerging institutional tokens. Currently, the annual on-chain settlement volume of stablecoins has exceeded the total of mainstream payment networks, reaching $27.6 trillion in 2024. They have evolved from initially being convenient tokens pegged to the dollar into a mature, yield-generating full-chain cash layer. Regulators, payment networks, and financial executives are gradually viewing stablecoins as assets on par with traditional bank currencies. A certain stablecoin issuer successfully went public in June 2025, raising over $600 million, reflecting market confidence in compliant stablecoin issuers.

As of August 2025, the total supply of stablecoins is $269.5 billion. USDT dominates with $154.4 billion, accounting for 57.3%, while USDC ranks second with $65.8 billion, making up 24.4%. Other important stablecoins include USDe with $10.5 billion, DAI with $4.1 billion, and USDS with $4.8 billion, while the market share of emerging or smaller stablecoins is less than 1%. This concentration reflects the dominance of traditional issuers and indicates that emerging stablecoins are under pressure to achieve differentiation through compliance and financial infrastructure strategic integration.

Stablecoins Transition to Yield Engines

As the monetary market interest rates break 4% in 2024, issuers have begun to tokenize U.S. Treasury bonds and pass the coupon income to holders. Currently, the market value of tokenized Treasury bonds has exceeded $5.8 billion, maintaining a quarterly growth rate of over 20% despite significant interest rate fluctuations. The broader RWA( real-world assets) tokenization—covering short-term credit, accounts receivable, and even real estate shares—has pushed the total on-chain RWA market value to $35 billion, with analysts predicting it will exceed $50 billion by the end of the year.

The difference in 2024 lies not only in the growth of scale but also in the direct linkage of on-chain yields to real-world assets (RWAs). A year ago, holding stablecoins was merely for capital preservation; today, an annual yield of 4-10% can be obtained through the following structure (APY):

• sUSDe: Generated profits through delta-neutral derivatives and basis trading, with a market capitalization of $3.49 billion.

• USDM: Tokenized short-term government bonds through the Bermuda regulatory framework, with a market value of 47.8 million USD.

• USDY: tokenized short-term government bonds, market value of $636 million.

• Plume Yield Tokens: Cross-chain distributed currency market fund (MMF) earnings, market value of $235 million.

This field is worth focusing on. Currently, over $5.8 billion of tokenized government bonds are in circulation, while the scale of interest-bearing stablecoins is compounding at a rate of over 25% per quarter. These assets blur the lines between stablecoins, money market funds, and tokenized fixed-income products.

By the second quarter of 2026, interest-bearing stablecoins will account for over 15% of the total supply of stablecoins, currently about 3.5%. They are no longer purely DeFi native products, but rather compliant-first, underlying assets that support composability, deeply integrated into the RWA ecosystem.

Three Major Trends Shaping the Next Generation of Stablecoin Leaders

1. Enterprise-level Integration

A stablecoin launched by a major payment giant has been deeply integrated into its mobile payment wallet, supporting merchant reward functions. The digital token of a large bank has even achieved daily transaction settlements exceeding $1 billion in its treasury system. As stablecoins accelerate their integration into ERP systems, payroll distribution, and digital banking architecture, a tenfold growth in this sector is expected.

2. Full Chain Interoperability

The fragmentation of blockchain has constrained industry development, but emerging cross-chain protocols are solving this problem through full-chain functionality. The next-generation mainstream stablecoins will achieve the native full-chain characteristic of "one-time minting, universal across the entire network."

3. Regulatory certification builds a moat

Specific regulatory agency certifications and approvals have become key differentiating factors in the stablecoin market, especially creating actual distribution advantages in B2B and corporate capital flows. Tokens from compliant issuers will receive a trust premium in the secondary market.

4. Improvement of Infrastructure Maturity

In the field of centralized finance, traditional payment giants are acquiring and laying out stablecoin channels. In the decentralized finance ecosystem, liquidity hubs, stablecoin exchange pools, and collateral lending platforms significantly enhance capital efficiency. As the ecosystem matures, stablecoins are deeply embedded in various levels of the financial system, becoming more reliable and having more complete functionalities as infrastructure.

The regulatory landscape is becoming increasingly clear

As of 2023, the issuance of stablecoins is still in a regulatory gray area. Now this window is rapidly closing, and the latest regulatory landscape is as follows:

1. The United States ( GENIUS Act )------ On July 18, 2025, the "Corporate Guaranteed Notes and Regulatory Issuance Act" ( GENIUS Act ) officially came into effect, marking a new era of regulation for USD stablecoins. This act, along with the 2025 "Digital Asset Market Clarification Act" ( CLARITY Act ), clearly defines compliant payment stablecoins as non-securities, aiming to provide regulatory certainty, enhance consumer protection, and maintain the competitiveness of the United States in the global digital asset market. Key points of the act include:

1. 100% reserve requirement: stablecoin must be fully backed by cash and short-term U.S. Treasuries at a 1:1 ratio. Reserve assets must not include high-risk assets ( and cryptocurrencies or credit assets ) are prohibited, and re-collateralization is not allowed except for specific liquidity needs.

2. Transparency and Certification Mechanism: The issuer must publish an audited reserve report every month; the CEO/CFO must personally certify the accuracy of the report.

3. Bankruptcy protection clause: stablecoin reserves are independently custodied; holders' redemption rights take precedence over other creditors ( similar to bank deposit protection mechanism )

4. Yield ban: Prohibit algorithmic stablecoins ( such as UST) and certain reserve models; only recognize fully collateralized "payment stablecoins"; prohibit paying interest to holders ( to avoid being classified as securities ).

The GENIUS Act, with its strict reserve and transparency requirements, is expected to enhance consumer confidence and promote the wider adoption of stablecoins. A clear regulatory framework will also attract more institutions to participate, solidifying the United States' global leadership in the regulation of digital assets.

2.EU (MiCA Regulation )------ The EU "Regulation on Markets in Crypto-Assets" (MiCA) implements the following provisions:

1. Licensing and Regulatory Requirements: Only licensed electronic money institutions or credit institutions may issue fiat-backed stablecoins (EMTs); the European Banking Authority (EBA) is responsible for regulating "significant" stablecoins; issuers of euro/dollar stablecoins must hold an electronic money license or banking qualification.

2. Full reserve requirement: Reserves must be 1:1 pegged to the circulating supply; more than 60% of reserves must be held in EU banks ( major stablecoin ); only low-risk assets are allowed ( government bonds/bank deposits ).

3. Usage Limitations: When the daily trading volume of non-euro stablecoins exceeds 1 million transactions or 200 million euros; the issuer will be forced to cease the expansion of usage.

4. Algorithmic stablecoin ban: a complete ban on algorithmic stablecoins without substantial reserves; only redeemable prudently backed tokens are recognized.

As of July 2025, the European Banking Authority has received over 50 license applications from stablecoin issuers, including mainstream institutions that are adjusting their operations to comply with MiCA standards.

3. UK Regulatory Framework ------ The UK regards stablecoins as regulated payment instruments, with core regulations including:

1. Reserve requirements: Only fiat currency fully collateralized stablecoins are allowed; reserve assets must be highly liquid assets such as bank deposits/short-term government bonds.

2. Yield prohibition: Prohibit the payment of interest to holders; the income from reserve assets belongs to the issuer ( for operating costs )

3. Licensing System: Issuers must obtain FCA authorization ( for new electronic currency/payment institution license ); must meet prudent standards for financial institutions: capital adequacy requirements; liquidity management mechanisms; T+1 rigid redemption commitment.

4. Innovation-oriented: Encourage banks and licensed institutions to issue payment-related stablecoins; focus on developing application scenarios such as cross-border remittances/micro payments.

4. Singapore ( MAS Regulatory Framework )------ The Monetary Authority of Singapore ( MAS ) has launched a tiered regulatory scheme:

1. Elastic licensing system: Issuers of stablecoins with a circulation below 5 million SGD may choose to operate with a regular Digital Payment Token License (; those exceeding this threshold must apply for a Major Payment Institution License ) and comply with specific regulations for stablecoins.

2. High-quality assets are pegged 1:1: Reserve assets are limited to cash, cash equivalents, or AAA-rated short-term sovereign bonds; treasury bonds maturing within 3 months from the issuing country of the pegged currency are accepted as reserves.

3. Redemption guarantee mechanism: Users enjoy a 1:1 rigid redemption right to complete within 5 working days (; unreasonable redemption fees are prohibited.

The stablecoin issuance service license added in March 2025 allows companies to focus on stablecoin business, relieving them of compliance burdens related to digital payment tokens. The MAS explicitly requires that stablecoin issuers must be banks or non-bank financial institutions registered in Singapore in Q2 2025.

5. Hong Kong ) Proposed Regulatory Framework ( ------ The Hong Kong "Stablecoin Ordinance" will take effect on August 1, 2025, with key contents including:

1. Full reserve requirement: The market value of reserve assets must be ≥ the face value of circulating stablecoins; limited to HKD cash, bank deposits, and HK/US government notes/bonds.

2. HKMA Mandatory Licensing: All stablecoins issued/promoted in Hong Kong ), including foreign currency pegged ones (, must be licensed; a major tech company has announced its intention to apply for a license.

3. Institutional-level standards: Reserve assets must be independently custodied by licensed custodians; regular operational audit reports must be submitted; a strict AML/CFT risk control system must be established.

A bank, a blockchain company, and a telecommunications operator have established a joint venture to issue a Hong Kong dollar stablecoin for cross-border payments. The regulation aims to connect with the digital renminbi pilot and strengthen Hong Kong's status as an international financial center.

6.UAE ) Regulatory Framework ------ The Central Bank of the UAE ( CBUAE ) established a stablecoin regulatory system with the "Payment Token Services Regulation" effective in June 2025, classifying stablecoins as "payment tokens". The compliant stablecoin AE Coin, which is pegged to the Dirham, serves as a representative case, and the framework emphasizes reserve backing and transparency. Key provisions:

1. Local stablecoin issuance: Only licensed institutions registered in the UAE can issue dirham-pegged stablecoins; full reserve must be maintained and regular audits accepted.

2. Foreign stablecoin restrictions: Only allowed for use in virtual asset trading; prohibited for local payments to maintain Dirham sovereignty.

3. Anti-Money Laundering Compliance: Issuers and custodians must implement strict KYC; establish transaction monitoring systems to meet AML/CFT requirements.

4. Digital Dirham ( CBDC ) Plan: Central bank digital currency may reshape the payment ecosystem; state-led digital payment systems to be prioritized.

The framework enhances confidence in local stablecoins such as AE Coin through strict reserve requirements, but restrictions on foreign stablecoins may suppress the overall development of the cryptocurrency market.

7. Japan's Stablecoin Policy ------ The 2025 amendment to Japan's Payment Services Act (PSA) establishes a globally leading regulatory framework for stablecoins, formally recognizing stablecoins as payment instruments starting from May 2025. Key points of innovation:

1. Elastic reserve requirements: The reserve asset ratio for trust-type stablecoins is relaxed to 50%; holding low-risk assets such as short-term government bonds from Japan and the United States is allowed.

2. New type of China license: Establish "electronic payment tools/cryptographic asset service intermediaries" category; exempt the capital requirements for asset custody intermediaries.

3. Bankruptcy protection mechanism: Learn from the lessons of a certain exchange's Japanese branch incident in 2022; require the exchange to retain assets in Japan.