According to a report by the Financial Times, major banks and fintech companies around the world are rushing to launch their own stablecoins to capture a share of the cross-border payment market that is expected to be reshaped by cryptocurrencies. Bank of America said last month that it is open to issuing its own stablecoin, joining payment service providers such as Standard Chartered, PayPal, Revolut and Stripe that have already entered this field.
11:FS co-founder Simon Taylor compared this phenomenon to FOMO (fear of missing out): "This is about people selling shovels in the stablecoin gold rush. Another factor driving it is that there is real transaction volume, and founders want a piece of the pie because they know stablecoin regulation is coming, so all these factors are coming together." Index Ventures partner and Bridge supporter Martin Mignot said that stablecoins are "attractive" in markets "lacking good infrastructure or liquidity and with a lot of currency risk", but their use cases in Western markets "are not so obvious".
Analysts warn that as users begin to scrutinize the quality of issuing companies, the market is unlikely to sustain the existence of dozens of stablecoins. Taylor pointed out that stablecoins are not cash, but only cash substitutes, reflecting the credit risk of the issuing company and its ability to manage operational risks: "Fundamentally, the brand of a stablecoin tells you who the issuer is. So because the issuing institution is that organization, your credit risk is X or Y. This is not something you do with the US dollar."
Currently, about $210 billion in stablecoins have been issued globally, with Tether issuing about $142 billion in USDT and Circle issuing $57 billion in USDC. According to Visa data, stablecoin transaction volume has grown from $521 billion in the same period last year to $710 billion last month, and the number of unique stablecoin addresses has grown 50% year-over-year to 35 million. As the regulatory environment becomes clearer, financial institutions are gaining more confidence in entering this industry. The US Congress is discussing a bill to set standards for stablecoins, the EU implemented regulations requiring stablecoin operators to comply earlier this year, and the UK financial regulator plans to consult the market this year.
