In today’s newsletter, Fintech Wrap Up’s Sam Boboev explains how stablecoins are becoming payment rails in the digital economy.
Next, “Ask the Experts” covers highlights for advisors from last week’s Consensus Conference in Miami, including the following key themes: Wall Street reaches a consensus.
Stablecoins are becoming payment infrastructure rather than crypto assets
Stablecoins began as a narrow solution for crypto traders who needed a reliable way to move between volatile assets without exiting the market, but that original use case no longer defines their role in today’s financial system.
What is happening now is a structural shift in how stablecoins are used, who uses them, and where they sit within the broader financial stack.
Over the past decade, stablecoins have gone through three distinct phases. In the early days, they primarily served as liquidity tools for trading, allowing faster movement of capital between exchanges. As decentralized finance expanded, they became core collateral instruments, supporting lending, borrowing, and yield-generating strategies across the crypto-native ecosystem. But now they are entering the third stage, where their main role is no longer tied to the crypto market, but to real-world financial operations, especially payments and financial management.
This transition is important because it fundamentally changes the economic purpose of stablecoins. They no longer just facilitate activity within cryptocurrencies. They are increasingly used to move funds across borders, between institutions, and within corporate financial workflows.
The reasons behind this change are not difficult to understand when viewed through the lens of operational efficiency. Traditional cross-border payments rely on correspondent banking networks that introduce multiple layers of intermediary, each adding cost, delay, and complexity to the transaction. Settlement can take several days, visibility is limited, and liquidity is often fragmented across jurisdictions.
Stablecoins compress much of this complexity into a single programmable layer. Transactions are settled in near real-time, run continuously regardless of bank business hours, and value can be moved across borders without the need for multiple communication relationships. For finance teams managing global operations, this is not a marginal improvement, but a meaningful change in the way liquidity is deployed and controlled.
Most importantly, this change is being driven by institutions rather than retail users. Stablecoin activity is increasingly focused on flows between companies, with companies using stablecoins for cross-border supplier payments, internal treasury transfers, and liquidity management across different markets. This shows that stablecoins are being adopted as operational finance tools rather than speculative vehicles.
At the same time, the market structure itself is evolving. The early growth of stablecoins was driven by relatively unregulated liquidity, often prioritizing speed of adoption over transparency and compliance. That dynamic is now being reversed as organizational participation increases. Financial institutions require clear reserve backing, auditable structures, and regulatory alignment before integrating new assets into their operations.
As a result, we are seeing a clear shift towards regulated and fully compliant stablecoins that meet these standards and can integrate more seamlessly with existing banking infrastructure. This has led to greater market consolidation, with trust, transparency and regulatory position becoming as important as size.
This also reframes how stablecoins should be understood from a competitive perspective. They are often grouped together with other crypto assets, but the real comparison lies elsewhere. Stablecoins are increasingly competing with traditional financial infrastructure such as correspondent banking networks, card payment systems, and foreign exchange mechanisms, especially in areas where speed, cost efficiency, and programmability create clear advantages.
This does not mean that existing systems will be completely replaced, but it does suggest that stablecoins will begin to capture certain segments of financial activity where their structural advantages are most obvious. Over time, this may lead to a redistribution of value across the financial ecosystem rather than a complete replacement of legacy systems.
The strategic implication is that the value of a stablecoin is determined not only by its market capitalization or trading volume, but also by how deeply it is integrated into real financial workflows. The most meaningful opportunities lie in integration into treasury operations, cross-border payment systems, capital markets infrastructure, and custodial solutions, serving as a connecting layer between different parts of the financial stack.
This gives rise to a broader pattern that recurs in financial innovation. New infrastructures often emerge in less regulated environments, scale rapidly due to their efficiency, and then are reshaped by institutional adoption and regulatory frameworks. Stablecoins are currently entering this latter stage, and their future will be determined by consolidation and standardization rather than experimentation.
The next stage of development will depend on how effectively stablecoins can be integrated into existing financial systems without disrupting the trust, compliance, and stability that the system requires. Banks, fintech companies and payment providers will play a central role in determining how this integration will unfold and which models will be adopted at scale.
Stablecoins are no longer a fringe development in the cryptocurrency market. They are becoming part of the infrastructure through which money moves, and their impact will be defined not by their origins in the cryptocurrency ecosystem, but by how they reshape the underlying mechanisms of global finance.
– Sam Boboev, CEO of Fintech Wrap Up
ask an expert
Last week’s Consensus by CoinDesk was a very successful event with 15,000 registered participants, 300+ media outlets, 180+ sponsors, and special speakers from over 110 countries. I had the opportunity to interact with several thought leaders and advisors on the ground. I summarize some observations below.
Q. What stood out this year in a room full of advisors?
What changed was not the topic, but who was in the room. While past years have centered around customer curiosity about cryptocurrencies, this year’s conversation was led by representatives from some of Wall Street’s biggest institutions. The message was clear. Demand is real and the launch of ETFs proves that, increasing the pressure to offer more products.
“Before, including cryptocurrencies in a portfolio was an asymmetric risk. Now there is no asymmetric risk.”
Q. What barriers are leading companies tackling?
Two themes dominated: education and custody.
Advisor education: Leading institutions are running large-scale internal programs to help tens of thousands of advisors understand digital assets: what the product is, where it fits in a portfolio, and which clients are right for it.
Custody: Ensuring that customer assets are safe and available for trading with liquidity remains a key concern. Institutional-grade storage infrastructure is a prerequisite before broader deployment.
Q. How are different agencies approaching this?
Panelists noted that it will take large companies about five years to complete this journey, and that the path forward will vary by company.
A “vertical-first” approach: One large bank’s digital assets division is working deeply to build expertise and governance in focused verticals before integrating cryptocurrencies throughout the portfolio-wide conversation, before expanding broadly. This process requires buy-in at the CIO level and spans compliance, risk, and financial crime teams.
A “bring everyone on board” approach: Some firms focus on extensive internal alignment to get all stakeholders, from risk committees to individual advisors, on the same page before expanding access to clients. The focus is on suitability, including which clients are ready, how to allocate them alongside traditional assets, and how to handle RIA relationships.
Key points for advisors
The institution that shapes how most Americans invest is now actively building towards access to cryptocurrencies for its customers. The questions have shifted from “if” to “how,” and the answers increasingly involve advisor education, institutional management, and portfolio integration frameworks. The foundations being built now will determine how quickly mainstream access arrives.
– sarah morton
Please continue reading
- The U.S. Senate Banking Committee released the text of the 309-page CLARITY Act ahead of Thursday’s price increases.
- Charles Schwab begins rolling out access to spot trading in Bitcoin and Ether to 40 million customers.
- JP Morgan has filed to launch a tokenized Treasury Money Market Fund ($JLTXX) designed as a GENIUS Act-compliant reserve asset for stablecoin issuers.
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