MetaMask’s mUSD Aims to Bridge Web3 and Mainstream Finance

MetaMask, the popular self-custodial crypto wallet developed by Consensys, is set to launch its first native stablecoin, MetaMask USD (mUSD), on the Ethereum and Linea blockchains later in 2025. The stablecoin, backed 1:1 by U.S. cash and short-term Treasuries, aims to deepen liquidity, expand protocol utility, and reduce onboarding friction for the wallet’s 100 million-plus users. It is issued by Bridge, a U.S.-licensed platform now part of Stripe, and is powered by the liquidity infrastructure of M0, a blockchain platform designed for application-specific stablecoins [1][2][4].

The launch of mUSD comes amid a surge in stablecoin usage, with the sector reporting nearly $1 trillion in monthly on-chain volume in recent months. This growth is supported by the newly signed U.S. GENIUS Act, which provides the first federal regulatory framework for payment stablecoins. MetaMask has highlighted the regulatory clarity as a catalyst for innovation, allowing the company to introduce a stablecoin that bridges the gap between traditional finance and decentralized finance (DeFi) [1][2][4].

mUSD will be integrated into the MetaMask wallet ecosystem, enabling users to perform a range of functions, including on-ramping, swapping, transferring, and bridging across chains. The stablecoin is also expected to be used in DeFi applications such as lending markets and decentralized exchanges. Additionally, users will be able to spend mUSD via the MetaMask Card at Mastercard-accepting merchants globally by year-end, further aligning the token with everyday financial activities [1][2][4].

MetaMask’s product lead, Gal Eldar, emphasized that the introduction of a wallet-native, self-custodial stablecoin simplifies the onboarding process for Web3 users. He noted that mUSD reduces the costs and complexity of entering the space, allowing users to move funds onchain, deploy them into DeFi, or use them for daily transactions. The stablecoin’s integration into Linea’s DeFi stack is expected to enhance liquidity and protocol usage, further cementing MetaMask’s role in the evolving DeFi landscape [1][3][4].

The stablecoin will compete in a market dominated by Tether’s USDT and Circle’s USDC, with retail sentiment toward USDT showing a neutral tone and USDC trending bearish. To stand out, mUSD leverages the partnership between Bridge and M0, which allows for faster deployment and compliance. This collaboration enables MetaMask to launch its stablecoin with minimal regulatory and technical overhead, a model also used by other firms such as BitGo and Paxos [2][4].

Despite its potential, mUSD faces regulatory and liquidity challenges. The U.S. GENIUS Act, while providing clarity, requires ongoing compliance with evolving standards. Additionally, the centralized nature of mUSD—being backed by reserves managed by Bridge—raises concerns among parts of the Web3 community about reliance on a central entity. Past stablecoin failures, such as Tether’s exposure to commercial paper reserves, have highlighted the risks associated with centralized models [5].

The launch of mUSD marks a pivotal moment in the expansion of stablecoin use cases, particularly in areas like crypto payroll and cross-border transactions. For businesses, especially in Asia and Europe, mUSD’s integration into payroll systems could offer faster, cheaper, and more transparent payments. However, small and medium enterprises (SMEs) must navigate complex regulatory landscapes and liquidity risks, which could affect adoption. As the stablecoin market matures, the success of mUSD will depend on its ability to balance convenience with decentralization and regulatory compliance [5].

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[1] MetaMask Joins Stablecoin Race With Launch Of mUSD (https://stocktwits.com/news-articles/markets/cryptocurrency/meta-mask-joins-stablecoin-race-with-launch-of-m-usd/chsSvzNRdie)

[2] MetaMask Introduces Its Own Stablecoin, mUSD, Powered ... (https://intellectia.ai/news/crypto/metamask-launches-its-own-stablecoin-musd-issued-by-bridge)

[3] MetaMask to roll out wallet-native mUSD dollar stablecoin (https://cointelegraph.com/news/metamask-musd-stablecoin-launch-ethereum-linea-2025)

[4] MetaMask Joins Stablecoin Race With mUSD, Backed by ... (https://www.coindesk.com/business/2025/08/20/stripe-s-bridge-teams-up-with-m0-protocol-to-issue-stablecoins-starting-with-metamask-s-musd)

[5] What is MetaMask USD (mUSD) and What Does it Mean ... (https://www.onesafe.io/blog/metamask-usd-impact-stablecoin-integration)