This week, stablecoin circulation hit an all-time high, fueling liquidity and confidence in the crypto market. What are the reasons for the growing momentum, and how does it impact businesses and economies?
Although stablecoins’ prices do not reflect public demand (they are designed to remain stable at about $1), rising trading volumes show clear institutional and individual interest in this type of crypto assets.
For Q1 2025, the trading volume of USDT (Tether), the world’s largest stablecoin by market cap, varied from 33 billion transactions a day to 292 billion, with an average of 94 billion transactions. This month, the average trading volume is about 88 billion transactions per day, with this week’s numbers not going lower than 120 billion. When we refer to historical charts, for most of 2024, the indicators rarely went over 70 billion, except for temporary spikes. Let’s analyze why the stablecoin popularity is growing.
What Are Stablecoins?
Stablecoin is a blockchain-based cryptocurrency programmed to maintain its price at the same level, typically pegged to a reliable fiat asset such as USD or EUR.
While offering the benefits of a decentralized financial ecosystem, fiat-backed stablecoins maintain their value by being fully or partially collateralized with fiat reserves or equivalent assets.
Simply speaking, for every stablecoin token in circulation, the issuer claims to hold $1 worth of relevant assets in cash, treasury bills, commercial paper, certificates of deposit (CDs), or repo agreements. Reputable stablecoin issuers are transparent about their reserves, having reliable third-party auditors regularly verify that the reserves equal or exceed the value of stablecoins in circulation.
If they wish, authorized users (typically institutions) can redeem stablecoins for fiat. When this happens, stablecoins are burned (extracted from circulation). This supply adjustment helps keep the price close to $1.
Stablecoin Market
As of July 2025, the aggregate stablecoin market cap lies in the range between $250 and $263 billion, according to various reports. Most of this value is distributed between a few major tokens. Thus, USDT alone accounts for around $159–160 billion, representing over 60% of the total stablecoin market cap. Circle’s USDC has an aggregate value of $63 billion – about a quarter of the total stablecoin market.
The market for these stable crypto assets is quickly growing. It first surpassed $200 billion only this January, needing about half a year to grow from $168 billion registered as an all-time high in August 2024. As the market growth accelerates, Citi predicts that the financial volume of the stablecoins market could reach a capitalization between $1.6 trillion and $3.7 trillion by the end of the current decade.
As it happens, stablecoin growth should be beneficial not only for crypto enthusiasts but also for businesses that leverage the power of these digital assets. In particular, business savings achieved through stablecoin use will increase by 73% up to $26 billion in 2028, compared to $15 billion in 2025, according to a recent forecast.
Stablecoin Use Cases
Besides a perceived stable mechanism and immutable blockchain technology behind them, stablecoins, unlike alternative cryptocurrencies, are seen as real-world utilities. Numerous financial institutions are exploring their potential for several use cases.
- Conducting cross-border transactions at a fixed currency exchange rate and with minimal fees.
- On-chain credit card settlement.
- Routine money transfers bypassing traditional banking rails.
- Integrate traditional payment networks with DeFi infrastructure.
- Crypto-to-fiat conversion.
- Corporate treasury management with faster, programmable cash flows.
- Real-time, auditable B2B payments.
- Cross-border payroll and contractor payouts.
- Credit card top-ups.
- Tokenized asset settlement.
- FX hedging for emerging markets with volatile currencies.
Legal Recognition
The world’s leading economies have controversial opinions about cryptocurrencies, with a lot of legal ambiguity surrounding these digital assets. However, stablecoins, which have the volatility factor extracted, are found to be less risky and more helpful for modern financial systems.
Stablecoin status is quite clear in Europe, where recent MiCA legislation categorizes these assets, treats them like electronic money under EU law, requires licensing from stablecoin issuers and supervises their activity, and protects customers’ redemption rights.
In the US, Congress is currently on the verge of adopting legislation that would provide a formal framework for the crypto sector, effectively making stablecoins a part of the regulated financial system. If adopted, the new bill would allow banks to store stablecoins and their reserves, use blockchain technology, and create digital versions of deposits. If a stablecoin issuer goes bankrupt, holders would be first in line to get paid. However, a court could temporarily pause stablecoin redemptions during the bankruptcy process.
The legislation, highly anticipated by crypto enthusiasts in the US, has caused some concerns in foreign financial communities. For instance, Amundi, an asset management firm, warned that the rapid growth of U.S. dollar-backed stablecoins under the GENIUS Act could disrupt global payments by increasing dollarization and weakening other countries’ monetary control. They also caution that stablecoins may act like unregulated quasi‑banks, risking financial instability.
Nevertheless, increasing legal recognition gives the private sector numerous opportunities to benefit from stablecoin use.
High-Profile Financial Institutions Raise Stakes
In addition to the growing efforts to facilitate stablecoin exchanges from a legal standpoint, institutional adoption plays a vital role in public perception of fiat-pegged cryptocurrencies.
Citibank Considers Stablecoin Issuance
Citigroup CEO Jane Fraser confirmed during the Q2 2025 earnings call that the institution is actively evaluating a “Citi stablecoin” along with tokenized deposits that currently remain the bank’s top priority. The financial giant is also exploring reserve management for stablecoins and custody services for digital assets.
Circle’s $1 Billion IPO Sent Shares Soaring by 700%
The IPO of a major stablecoin issuer, Circle, has led to a real investors’ frenzy. In June, Circle sold about 34 million shares at $31 each, raising approximately $1.1 billion and valuing the company at around $8 billion fully diluted. Today, the stablecoin company’s stock price jumped to $235 per share, bringing it a $58 billion market cap, close to the total market valuation of its own stablecoin USDC.
Visa & Mastercard Invest Heavily in Stablecoin Infrastructure
The two major global card payment networks, whose dominance is increasingly undermined by faster real-time A2A payment rails, are exploring various avenues to boost their infrastructure. Dealing with stablecoins is part of that effort. Recently, Mastercard introduced new end-to-end capabilities, creating a complete stablecoin support ecosystem, with components ranging from digital wallets to full checkout systems, that can make stablecoin payments as seamless as everyday fiat transactions. Meanwhile, Visa has invested in a stablecoin infrastructure platform BVNK, and partnered with Rain, a global card-issuing platform for stablecoins, within its pilot program to bring credit card payment settlement fully on-chain.
The Likes of Stripe, PayPal, and Revolut Engage in Stablecoin Development
Major fintech players are eagerly embracing the potential of stablecoin capabilities in a number of different projects:
- Stripe & Ramp are preparing to launch the industry’s first stablecoin-backed corporate cards. Stripe also acquired Bridge (a stablecoin orchestration platform) and Privy (wallet infrastructure) startups to further develop its stablecoin-based offerings.
- PayPal has issued its own stablecoin, PYUSD, with cross-blockchain functionality and practical applications like SMB financing.
- Revolut is reportedly in advanced stages of developing its own stablecoin, though the company didn’t make any official statements regarding this project. At present, the company facilitates crypto trading, including stablecoin purchase, via its crypto exchange app.
- Fiserv has launched FIUSD, a programmable, blockchain-based token. Almost from the start, it got integrated into Mastercard’s vast network of over 150 million merchants worldwide.
Bottom Line
As stablecoins transition from speculative tools to everyday financial instruments, they are quietly reshaping how value moves across borders, platforms, and industries. Their growth today is driven by demand for faster, cheaper cross-border payments, increasing regulatory clarity, and institutional adoption across finance and fintech. Their rising utility in traditional finance and commerce suggests that we may be witnessing the early stages of a new monetary layer — the one that runs parallel to fiat but operates at digital speed. The question now is not whether stablecoins will play a role in global finance, but how quickly the world will adapt to the rules of this programmable money.
