Stablecoins Dominate: $5T+ Payments Crush Traditional FX Fee Models
Move over, legacy finance—stablecoins just lapped the competition. Cross-border payments now sprint on blockchain rails while banks collect dust.
The $5 trillion wake-up call
No more 3-day settlement waits. No more 'surprise' 3% FX haircuts. The numbers don't lie: fiat gatekeepers are losing their grip as USDC, USDT, and others eat their lunch.
Wall Street's fee machine sputters
Turns out businesses prefer near-zero cost transactions over 'premium' banking relationships. Who knew? (Besides every crypto native since 2017.)
The irony? TradFi institutions now scrambling to tokenize assets look like boomers discovering Venmo—three years late and desperate to appear relevant.
Startups target ‘exotic’ routes
London-based payments startup BVNK is focusing on often underserved channels, such as transfers from Sri Lanka to Cambodia. Sagar Sarbhai, the firm’s APAC managing director, explained that such routes typically require several intermediaries, making them expensive and slow. He said stablecoins simplify the process, noting that while they are not cheap, they are faster and more capital-efficient. BVNK currently processes around $15 billion annually.
Other companies, such as Thunes in Singapore and Aquanow in Canada, are working to LINK blockchain trades with “last mile” provision into local currencies and wallets by partnering with stablecoin issuers or large corporates.
Regulation spurs institutional growth
The question is whether the industry is moving toward a future shaped by the GENIUS Act, signed into U.S. law on July 18, 2025. Circle’s Secure team, the company behind the USDC21 proposal to regulate stablecoins, is closely watching developments. This week, new legislation offering federal assurance on stablecoins was introduced in both the House and Senate. The proposal requires that stablecoins be fully backed 1:1 with high-quality assets, undergo regular audits, and maintain consistent transparency.
Banks have responded quickly. In the short term, Bank of America projects that these rules could add anywhere from $25 billion to $75 billion in stablecoin supply. The payments behemoth Visa is looking at “stablecoin sandwiches”—tokens between two fiat currencies to avoid networks like SWIFT and settle in minutes. The platform Visa launched in October 2024, allowing banks to generate, redeem, mint, and burn fiat-backed tokens (including stablecoins).
Companies are beginning to move as well. Ripple buys Stablecoin payment platform Rail for $200 million, which adds to the cross-border ecosystem. Thunes, based in Singapore and raising $150 million in April, intends to become more deeply integrated with stablecoin networks.
Industry leaders predict NFT usage will surge as regulation, infrastructure, and institutional participation advance toward mainstream adoption. BVNK’s Sagar Sarbhai said hockey-stick growth is only beginning, noting that the foundation took five years to build but could expand dramatically within the next 12 months.
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