5 years in the past, SpaceX launched Starlink, which has since grown into its greatest income driver, increasing to greater than 100 international locations. However as Starlink scaled, it confronted a significant hurdle: accepting funds in growing markets, the place conventional banking infrastructure is unreliable, gradual, and vulnerable to blocking transactions. Many native banks throughout Africa, Latin America, and Asia wrestle with worldwide funds, forcing SpaceX to search for options.
To bypass these challenges, SpaceX turned to stablecoins, a fast-growing methodology for cross-border funds already extensively utilized in rising markets. The corporate partnered with Bridge, a stablecoin funds platform, to simply accept funds in varied currencies and immediately convert them into stablecoins for its world treasury. This transfer positioned Bridge as a viable different to correspondent banks in markets the place conventional monetary methods fall brief. Quickly after, Stripe took discover, buying the startup for greater than $1 billion and solidifying Bridge’s popularity and driving up its valuation as an infrastructure participant, fixing inefficiencies in world finance.
The rise of stablecoins — now a $205 billion market — is pushed by real-world utility, not hypothesis, significantly in rising markets the place probably the most compelling use circumstances unfold. Cross-border funds in these areas are usually gradual and costly, involving a number of intermediaries. For instance, a textile producer in Brazil paying a provider in Nigeria might need to undergo a number of banks and foreign money exchanges, every including charges and delays. Stablecoins take away this friction, enabling cheaper, near-instant transactions.
Adoption and investor curiosity surge
This rising demand has led to large transaction quantity progress for startups offering stablecoin cross-border options for companies in Africa and rising markets.
Yellow Card, which gives a platform that lets customers convert fiat to crypto and again to fiat, doubled its annual transaction quantity to $3 billion in 2024 from $1.5 billion in 2023. Conduit, which allows stablecoin funds for import-export companies in Africa and Latin America, noticed its annualized TPV leap to $10 billion from $5 billion. Lagos-based Juicyway, which facilitates cross-border funds utilizing stablecoins, has processed $1.3 billion in complete fee quantity thus far.
Investor curiosity has additionally surged, with high enterprise companies backing stablecoin-powered fintechs focusing on these markets. Peak XV and HongShan, the companies that cut up from Sequoia, co-led a $10 million seed spherical in KAST, a neobank that lets customers maintain and spend stablecoins. Sequoia itself was a significant backer of Bridge. Yellow Card raised $33 million, led by Blockchain Capital. Conduit, which raised a $6 million seed spherical final yr, is finalizing one other spherical. In the meantime, QED Buyers led a $9.9 million funding in Cedar Cash, a stealthy fintech utilizing stablecoins for cross-border transactions. Initialized led an $8.5 million spherical in Caliza, which is bringing real-time transfers to Latin-America utilizing USDC. Tether itself invested a large test in an African stablecoin infra and liquidity supplier, cryptopressnews has discovered.
The pattern is evident: Stablecoins are not a crypto experiment — they’re changing into a core a part of monetary infrastructure in rising markets to maneuver cash globally. As adoption accelerates, the query is just not if stablecoins will remodel funds however how rapidly they’ll stand alongside — and even exchange — outdated monetary methods.
Some numbers replicate this shift. In line with a16z, sending $200 from the U.S. to Colombia through stablecoins prices lower than $0.01, in comparison with $12.13 utilizing conventional strategies. Fee platforms are adapting, making a reduce albeit a smaller one than the standard middlemen rails. Stripe, for example, now costs 1.5% for stablecoin transactions, 30% decrease than its commonplace card charges. Companies and people are additionally utilizing stablecoins as a hedge in opposition to inflation and a extra steady retailer of worth, with USDT and USDC changing into vital instruments.
Functions exterior cross-border and remittance
Whereas cross-border funds and remittances have pushed early adoption, stablecoins are actually gaining traction in shopper finance, payroll, and, partly, retail transactions.
This January, Brazilian unicorn Nubank launched a characteristic rewarding USDC holders with a 4% annual return, following a tenfold enhance in customer-held USDC final yr. Now, 30% of Nubank’s customers have USDC of their portfolios. Nubank joins different fintech giants like Venmo, Apple Pay, PayPal, Money App, and Revolut, which already allow in-app stablecoin transactions.
Past shopper financial savings, stablecoins are reshaping world payroll. As distant work expands, startups like Rise permit corporations to pay contractors utilizing stablecoins. The platform lets companies pay in fiat whereas contractors obtain stablecoins like USDC or USDT, avoiding foreign money volatility. Final November, Rise raised $6.3 million in Collection A, fueling its growth in stablecoin-powered payroll options.
“The market goes the place we’re constructing and it’s solely a matter of time till the large gamers get within the enviornment. They may provide stablecoins by partnering, buying, or constructing a crypto fee infrastructure,” Rise CEO Hugo Finkelstein informed cryptopressnews.
And whereas retail adoption of stablecoins has been slower, startups like Cashnote.io are testing options. The platform, developed by Korean fintech Korea Credit score Information and web3 VC agency Hashed, allows retailers to simply accept bank card and digital asset funds through a point-of-sale system. Retailers can course of funds utilizing stablecoins with out the restrictions of bank card limits and customers can use digital property for on a regular basis purchases.
Each companies are testing the platform within the Abu Dhabi International Market (ADGM), probably the most crypto-friendly regulatory environments globally. Cashnote.io is projecting to go stay with retailers within the area over the approaching months, with UAE-based digital property infra supplier Fuze appearing because the settlement accomplice. Fuze raised a $14 million seed in 2023.
But, regardless of stablecoins’ potential to streamline funds globally, issues stay. For one, critics warn that stablecoins may disrupt financial coverage. As they grow to be extra widespread in world finance, some fear they might mirror previous issues about dollarization, the place economies rely too closely on the U.S. greenback as a substitute of constructing impartial monetary methods.
Equally, their effectivity comes with trade-offs. In contrast to government-backed currencies, they rely upon personal corporations like Circle and Tether to keep up their worth. These corporations use money reserves, short-term securities, and different monetary property to maintain stablecoins pegged to the U.S. greenback. Nevertheless, the 2022 collapse of TerraUSD exhibits how weak stablecoins will be.
Regulatory shifts may make or mar adoption
Governments and regulators worldwide are paying consideration, and their actions will affect stablecoin adoption. Some areas like Abu Dhabi’s ADGM, for instance, have positioned themselves as crypto-friendly zones, enabling fintech companies to experiment with stablecoin funds. Hashed CEO Simon Kim says Cashnote.io may solely work within the area because of the area’s structured and supportive authorized framework.
“There’s hardly a authorities like Abu Dhabi that accelerates innovation from new challengers overseas like this,” Kim informed cryptopressnews. “It has many sandboxes and authorities assist methods for testing revolutionary and new crypto infrastructure.”
Equally, the UAE made headlines final yr when a courtroom ruling permitted salaries to be paid in crypto, reinforcing the nation’s place as a worldwide hub for digital asset innovation.
Africa presents a special present. In lots of circumstances, innovation strikes sooner than regulation, forcing policymakers to react solely after fintech proves its worth — simply as they did with cell cash, in accordance with Zekarias Amsalu, co-founder of certainly one of Africa’s high fintech occasions. He believes regulators, somewhat than being overtly cautious, ought to embrace stablecoins as they already assist scale back cross-border switch and remittance prices by as much as 75%.
“In case you are prepared to formalize Franco-Valuta [policy that allows the import of goods without using foreign exchange from a bank] when the greenback crunch bites, in opposition to all actual dangers, why not take into account formalizing stablecoins which can be supplied by licensed exchanges with all transparency and compliance?” Amsalu posits.
Whether or not their stance modifications or not might rely upon how regulation shapes up within the U.S., which is contemplating new legal guidelines that might have a worldwide impression on stablecoins: A strict regulatory strategy — although unlikely — may gradual adoption and impose tighter monetary controls on issuers. However, a pro-stablecoin stance may encourage extra international locations to create clear licensing guidelines for digital property. “These are very robust alerts for traders,” Finkelstein stated.
