In recent months, stablecoins have gained traction across the financial sector, attracting interest from institutions, banks, regulators, and technology firms eager to establish a competitive foothold. This momentum is driven by rising institutional demand and clearer policy frameworks that reduce uncertainty and enable broader market participation.
What are stablecoins?
Stablecoins are digital assets designed to maintain a stable value by being pegged to a reference asset, typically fiat currencies such as the US dollar or the Euro. They are issued as tokens on blockchain networks, combining the speed and flexibility of digital currencies with the value stability of traditional money, making them ideal for payments, remittances, and reducing volatility in decentralised finance (DeFi) applications.
What has changed in 2025
Several recent developments have driven the increased interest in stablecoins, such as:
Regulatory frameworks in the UK (via CryptoPRU), EU (through MiCA), and the US (via the GENIUS Act) are accelerating institutional adoption by reducing compliance uncertainty.
Cross-border use cases in emerging markets are driving demand for dollar and euro-backed alternatives to volatile local currencies.
Stablecoins are emerging as a cost-effective complement to legacy infrastructure with the potential to streamline payments, settlements and cross-border transactions.
These shifts are prompting broader institutional adoption, including:
This wave of adoption signals a broader transformation in how traditional financial institutions view digital assets - as a strategic enabler for modernising payments and expanding cross-border services.
The role of stablecoins in modern financial infrastructure
As adoption accelerates, stablecoins are beginning to find applications beyond crypto-native environments. According to Visa’s Onchain Analytics Dashboard since 2019, the total transaction volume on public blockchains globally has surpassed $250T USD, with a 28% YOY increase.
The main drivers behind this growth are:
Faster settlement: Stablecoin transactions settle in near real-time, compared to traditional banking transactions that are much slower.
24/7 global transfer capability: Unlike conventional systems limited by geography and banking hours, stablecoins enable continuous, cross-border transfers with minimal delays.
Reduced transaction costs: By reducing reliance on intermediaries, stablecoins offer a lower-cost alternative for cross-border payments, particularly in remittances and international trade.
Regulation is enabling scale and institutional confidence
The recent GENIUS Act in the USA, along with CryptoPRU in the UK and MiCA in the EU, introduce comprehensive rules in licensing requirements, reserve management standards, and disclosure obligations for stablecoins. In the case of CryptoPRU, the FCA has set out clear capital and liquidity requirements to protect consumers and ensure financial stability.
This regulatory clarity is unlocking participation from larger institutions, with various major US banks exploring or preparing to launch their own stablecoins. Regulatory alignment efforts are gradually lowering compliance barriers, helping drive demand from both retail and institutional markets.
At Braithwate, we welcome the regulatory updates brought by frameworks such as the GENIUS Act, MiCA and CryptoPRU. These changes foster a more competitive and innovative financial sector, while maintaining key points on safeguards around transparency, reserves and consumer protection.
We will shortly publish a comparative analysis of the requirements and implications of these regulatory regimes. If you are looking for a better understanding of these topics, please contact us to explore how you can leverage our new solution, FintechXpndr, to help you navigate licensing and operation in different crypto regimes across the world.