The stablecoin market cap hit a new all-time high (ATH) of $226.8 billion this Thursday—even as the broader crypto market experienced a significant dip.

A Santiment report highlights that on March 12, the on-chain activity of Tether (USDT) reached a six-month high, with over 143,000 wallets transferring USDT in a single day. Notably, since January 1, the aggregate stablecoin supply has also  increased by $20.17 billion (+10.9%), now surpassing $205 billion, according to Glassnode data.

Stablecoins—digital assets pegged to traditional currencies like the U.S. dollar—serve as a reliable store of value for investors during periods of high market volatility.

As their scope expands with increasing use cases in cross-border payments, and as they gain institutional and financial acceptance, CoinGape speaks exclusively with Mark Boiron, CEO of Polygon Labs in this #PoweTalk.Sta

With Polygon PoS emerging as the third-largest blockchain for on-chain stablecoin transactions, Boiron discusses the growing role of stablecoins, evolving regulatory landscape, and future prospects. He also explores whether stablecoins could replace traditional payment rails and whether they can coexist with Central Bank Digital Currencies (CBDCs) in the future.

Polygon Labs CEO Marc Boiron begins, “Stablecoins are making it faster and cheaper to move money across borders—whether you’re an individual or a business. And as yield-bearing stablecoins gain traction, especially in 2025, they’ll likely become a bigger draw for traditional financial players, opening up even more opportunities in the space. This shift is massive, and it’s just getting started.”

First appearing on the Web3 landscape in 2024, stablecoins are combining the technological benefits of Blockchain such as transparency, efficiency and programmability, with the financial stability needed for quick adoption in the real-world.
This include Fiat-pegged stablecoins such as USD-pegged Tether (USDT), USD Coin (USDC), commodity-pegged such PAX Gold (PAXG), Tether Gold (XAUT), and  Crypto-backed Stablecoins such as Dai (DAI).

Stablecoins moving beyond Applications of Trading and Speculation

Evolving from their mere applications of speculation and trading with BitUSD (on BitShares) and NuBits among the first stablecoins, Stablecoins are emerging as a reliable asset for cross-border payments, peer-to-peer (P2P) transactions.

They are enabling cheap and fast cross-border money transfers, bypassing traditional banking fees and delays. They are also acting as the on-ramp to DeFi by facilitating lending, borrowing yield farming for many DeFi protocols. For instance, Aave & Compound offer stablecoin-based loans, enabling users to lend stablecoins to earn interest or use them as collateral for crypto loans.

Stablecoins have moved far beyond just crypto trading—they’re now playing a big role in things like cross-border payments, remittances, and corporate treasuries. Over the next few years, I see stablecoins becoming a key part of the global financial system.

We’re already seeing a market cap of over $200 billion, but that’s just the beginning. To put it in perspective, the U.S. M2 money supply is over $21 trillion, so we’re still under 1% penetration. Hitting $3 trillion by 2030 is totally within reach, and that would only be about 15% of the current M2 supply,” explains CEO Marc.

In another new instance of stabelcoins usecases, Binance, the leading global Crypto exchange, recently secured a $2 billion investment from tech investor MGX, marking it the largest crypto-related deal conducted using stablecoins. Highlighting the growing utility of stablecoins in VC Fundings and Investments as well, Binance deal was followed by another stablecoin supported funding of $82M received by Mesh, as reported by CoinGape.

Source: https://x.com/glassnode/status/1900146408407114107

Will Stablecoins Replace Traditional Payment Rails

No doubt, stablecoins offer faster, cheaper and borderless transactions, in comparison to their traditional counterparts of banking payment rail such as SWIFT and Visa.

While traditional cross-border transactions via SWIFT can take 1–5 business days to settle due to multiple intermediaries, stablecoins since they operate on blockchains networks, can settle such transactions in seconds to minutes, regardless of geography.
Further, transactions by them cost fractions of a cent in comparision to traditional payment rails, implying significant cost savings for the users.

But on the queston of whether stablecoins would end up replacing traditional payment systems, CEO Marc says, “Traditional payment systems are due for an upgrade, and stablecoins are stepping in to offer a much-needed solution. While they won’t replace existing systems overnight, they already provide clear benefits like faster global transactions, lower costs, and greater accessibility, making them an increasingly appealing choice.”

Further, with the growing adoption and development of stablecoins, traditional payment systems can also taking cues from it – in order to stay relevant in the rapidly growing scenario of borderless payments. Visa and PayPal are already integrating USDC & PYUSD for payments while JPMorgan’s Onyx blockchain is using tokenized dollars for real-time settlements.

Prominent Players Entering as Stablecoin Issuers

Amid the growing acceptance of stablecoins among regulators around the world, some of the World’s largest banks and Fintech are also rushing to launch their own stablecoins.

Notable entrants include Bank of America with the bank signalling last month that it is exploring the issuance of its own stablecoin to enhance cross-border payment efficiency and reduce transaction costs.

CEO Marc points out, “Even companies that aren’t traditionally in crypto are jumping on board. Launching a stablecoin isn’t just about making money—it’s also a way to attract new users and create stronger communities. For consumers, this means cheaper, faster, and more efficient payment options, especially for things like remittances, where traditional systems often hit you with high fees.

Take Tether’s massive $2.5 billion profit last year as an example—it’s no surprise so many companies are eager to get involved. Plus, the regulatory landscape is shifting in favor of crypto, with Europe’s MiCA regulation offering more clarity and the U.S. likely to follow suit. This combination of profit potential and clearer rules is pushing stablecoins into the spotlight, and consumers are poised to benefit from the improvements to payment systems.”

In 2023, PayPal introduced PayPal USD (PYUSD), a USD-pegged stablecoin integrated into its existing payment platform while Stripe recently acquired Bridge, a stablecoin orchestration platform, for $1.1 billion, to enhance cross-border payment processing capabilities.

Revolut, the fintech company is also venturing into the stablecoin sector, Notably, in December 2024, Ripple, XRP’s largest issuer also launched its stablecoin, RLUSD, pegged to the U.S. Dollar, after receiving an approval from the New York Department of Financial Services (NYDFS).

Challenges and the Evolving Regulatory Environment

Governments and financial regulators worldwide are still debating how to classify and regulate stablecoins (as securities, commodities, or digital payments). Jurisdictions like the U.S. and the EU have different approaches, making global compliance difficult.

However, in a move that augurs well for the regulatory scenario of stablecoins, the US Senate is set to vote on the “GENIUS Act,” a bill co-sponsored by Senators Bill Hagerty and Kirsten Gillibrand, which seeks to grant federal legitimacy to stablecoins and promote their mainstream adoption.

When it comes to stablecoin regulations, Europe is definitely leading the way with MiCA. The U.S. is likely to follow suit with an approach that achieves the same goal, and Asia will probably have its own regulations tailored to the region.

Looking ahead five years, I think we’ll have a well-regulated global stablecoin ecosystem with clear rules and standards. This will open the door for stablecoins to be used in everyday retail transactions, just like cash or credit cards.

On the Competition with CBDCs

Some governments are pushing for Central Bank Digital Currencies (CBDCs), but I think private stablecoins and CBDCs will end up coexisting rather than one dominating the other. They serve different but complementary roles, each with its own strengths.

Notably, the European Central Bank (ECB) is actively working on a Digital Euro, expected to enter its preparation phase by 2025.

However, China is leading the CBDC race with the Digital Yuan (e-CNY), developed by the People’s Bank of China (PBOC). It has been piloted in major cities like Beijing, Shanghai, and Shenzhen and the Winter Olympics of 2022 in Beijing was the first large-scale international use case of the Digital Yuan.

Stablecoins to become Everyday Tool by 2030, says Marc

Stablecoins offer efficiency, stability, and accessibility in digital finance, but they also face significant challenges across regulatory, economic, and technological fronts. For instance, as with all digital assets, stablecoins can present money laundering and terrorist financing (ML/TF) risks.

If I had to make a bold prediction about stablecoins in 2030, I’d say they will be the go-to form of digital payment worldwide, with a market cap that could easily surpass $5 trillion. We’ll see them integrated into nearly every major financial app and service, making transactions smoother and more efficient for everyone.

The technology is already there, capable of supporting widespread use. The main hurdles are regulatory and educational. Once those are addressed, they could become a common, everyday payment method, making things faster, cheaper, and more efficient for consumers.

By 2030, the line between traditional finance and crypto will be pretty much gone, with stablecoins playing a key role in bringing everyday users into the Web3 space. Central banks will have embraced private stablecoins as part of their broader monetary policies, recognizing the benefits they bring to the table.

The real game-changer, though, is how they will make financial services available to billions of people who are currently underserved by traditional banks. They’ll be the tool that helps democratize access to the global economy, making it easier for people around the world to take part in the digital financial world. For users, this means faster, cheaper, and more inclusive financial services that open up opportunities for growth and financial freedom.

The post Stablecoins to Surpass $5 Trillion and Co-Exist with CBDCs, Says Polygon Labs CEO appeared first on CoinGape.

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Filed under: News - @ March 15, 2025 9:13 am