Stablecoins' Mainstream Potential: From Cross-Border Transactions to Everyday Payments

Stablecoins, digital assets tied to fiat currency, are gaining traction for cross-border transactions due to lower costs, less friction, and faster settlements. Stablecoins are expected to become more mainstream as U.S. regulators implement the Genius law's policy framework. Industry professionals believe stablecoins will filter down to consumer-level payments, but it's uncertain when this will happen. Stablecoins are currently used for settling cross-border transactions, facilitating lower-cost remittances, and storing value for people in countries with severe inflation.

Stablecoins, digital assets pegged to fiat currency, are increasingly being adopted for cross-border transactions due to their advantages in cost, speed, and efficiency. As U.S. regulators implement the Genius Act, stablecoins are poised to become more mainstream, potentially filtering down to consumer-level payments. While the timeline for this shift remains uncertain, stablecoins are already being used for settling cross-border transactions, facilitating lower-cost remittances, and providing a stable store of value for individuals in countries with severe inflation.

Coinbase and PayPal have recently launched stablecoin yield programs offering up to 4.1% APY for PYUSD and USDC holders, aiming to boost stablecoin adoption in retail and B2B transactions [1]. These initiatives are part of a broader industry momentum where FinTechs and legacy institutions are exploring stablecoin corridors despite pending regulatory frameworks like the proposed GENIUS Act. The GENIUS Act, passed on July 18, 2025, aims to establish a legal framework for stablecoin operations in the U.S. by allowing legal entities to issue stablecoins backed by cash or cash-equivalent assets [2].

The act categorizes stablecoins into payment and non-payment types, with payment stablecoins being those backed by the U.S. Dollar or dollar equivalents. It mandates high-quality reserves and dual regulatory oversight, ensuring compliance with Anti Money Laundering (AML) and Know Your Customer (KYC) guidelines. The implementation of the GENIUS Act has already led to a surge in stablecoin trading volumes and an increase in the market cap of stablecoins, with expectations of further growth [2].

While the adoption of stablecoins is expected to grow, regulatory challenges remain. The GENIUS Act is a comprehensive regulatory framework, but its full impact on the stablecoin market is yet to be seen. Industry professionals believe that stablecoins will eventually become part of the mainstream financial ecosystem, but the timeline for this shift remains uncertain. As the U.S. continues to navigate its regulatory path, stablecoins are likely to play an increasingly prominent role in global financial transactions.

References:
[1] https://www.ainvest.com/news/coinbase-paypal-launch-stablecoin-yield-programs-regulatory-uncertainty-2508/
[2] https://cryptorank.io/news/feed/d25ca-genius-act-for-stablecoin-regulations-in-the-usa