Payment Giants Drive Stablecoin Consolidation: Three Coins Dominate with Lower Fees and Global Reach

The stablecoin market is undergoing a significant consolidation phase, with only three major coins-USDC, USDT, and a third, less publicly identified-emerging as dominant players amid broader industry pressures. This trend underscores a shift toward regulatory clarity, institutional adoption, and cost efficiency, as smaller stablecoins struggle to compete with the infrastructure and partnerships of market leaders.

The dominance of these three stablecoins is evident in their integration with global payment processors and e-commerce platforms. Stripe, which processes hundreds of billions annually, expanded USDC support in October 2024 across Ethereum, Solana, and Polygon, enabling merchants to handle cross-border transactions with reduced fees. By 2025, the platform further extended this functionality to subscription payments on Base and Polygon, targeting the 30% of its merchants reliant on recurring revenue models. Merchants using stablecoins reported transaction costs dropping by roughly 50% compared to traditional card networks, with some processing up to 20% of their volume through stablecoins.

PayPal's PYUSD also gained traction in 2025, expanding support from four to thirteen blockchains, including Tron, Avalanche, and Aptos. This move reflects a broader industry push to diversify blockchain accessibility while competing with USDC and USDT, which remain the largest stablecoins by market capitalization. Western Union piloted blockchain-based settlement for remittances, aiming to eliminate correspondent banks in high-friction corridors-a strategy that could reduce delays and intermediary fees.

The survival of only three major stablecoins is partly attributed to regulatory and operational advantages. For example, Alibaba's decision to prioritize tokenized fiat deposits (such as US dollar and euro-backed assets) over stablecoins for its cross-border payments system highlights the preference for bank-issued tokens in environments where regulatory scrutiny remains high. This trend suggests that projects lacking institutional-grade compliance or liquidity may face further marginalization.

In contrast, decentralized finance (DeFi) projects like Mutuum Finance, which raised $18.7 million through its presale, represent an alternative but nascent approach to stablecoin use cases. However, their focus on automated lending and borrowing protocols lacks the immediate scalability and institutional trust of the top three stablecoins .

The market consolidation also reflects broader macroeconomic pressures. While Bitcoin's recent volatility-approaching a "death cross" pattern-has drawn attention, stablecoin demand remains resilient in sectors prioritizing efficiency, such as e-commerce and remittances. Shopify's integration of USDC on Coinbase's Base network in June 2025, for instance, allowed 34 countries to access zero FX fees and instant fiat settlement, further embedding stablecoins into global commerce.

Critics argue that the dominance of three stablecoins risks centralization, but proponents counter that their widespread adoption has streamlined financial infrastructure. As of 2025, stablecoins accounted for a growing share of cross-border transactions, with specialized providers like ForumPay offering solutions to mitigate volatility exposure for businesses.