What is a stablecoin?
A stablecoin is a digital token issued on a blockchain, designed to maintain a stable value – typically pegged 1:1 to a fiat currency like the US dollar or the euro. In other words, it’s a digitised dollar (or euro) that can move at the speed of the internet, 24/7, with near-zero transaction costs and with settlement times measured in seconds rather than days. Originally created to serve as a ‘parking space’ for crypto traders, stablecoins have rapidly evolved into global payment rails, store-of-value assets and building blocks for decentralised finance (DeFi) and cross-border commerce.
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Developments in digital asset rails & payments
Today’s digital payment infrastructure is undergoing a quiet revolution. In the past, blockchains were seen as the exclusive playground of crypto speculators, but stablecoins have given them something far more practical: a means of moving money quickly, cheaply and transparently across borders.
As Visa noted, stablecoins add an “incremental payment infrastructure” that modernises digital payments. What began as a mechanism for crypto capital markets is now gaining traction in mainstream use cases — remittances, B2B payments, e-commerce and even payroll.
In 2024 alone, stablecoins processed over $35 trillion in transfer volume, surpassing even the Visa and Mastercard networks. Increasingly, they are being integrated into fintech wallets, neobanks and payment service providers (PSPs).
What are the growth factors?
The growth of stablecoins is being driven by several secular trends:
- Faster, cheaper cross-border payments – Traditional rails like SWIFT can take days and involve opaque fees. Stablecoins settle in seconds, often for pennies.
- Demand from emerging markets – In countries with volatile currencies or limited banking infrastructure, stablecoins serve as a stable store of value.
- Integration with fintechs and global merchants – Major players such as Stripe, Visa, Mastercard, PayPal and Circle are weaving stablecoins into their platforms.
- Regulatory clarity – The EU’s MiCA regulation and evolving bipartisan US legislation are providing a clearer legal foundation.
- Yield opportunities – Some emerging models now offer yield-bearing stablecoins.
Who are the emerging players in the sector?
While Tether (USDT) and Circle’s USDC still dominate — accounting for 90%+ of market share – we’re seeing a broadening of the ecosystem.
Emerging players include:
- Paxos / PayPal (PYUSD) – Combining stablecoins with mass-market platforms.
- First Digital USD (FDUSD) – A fast-growing challenger.
- Ethena Labs (USDe) – Yield-backed stablecoins.
- Banking Circle (EURI) – Euro-pegged stablecoins for B2B commerce.
- Fintech infrastructure firms like BVNK, Ripple and Bridge/Stripe, enabling stablecoin-powered payments, as well as infrastructure.
In short: the market is decentralising, with room for specialist players alongside the big incumbents.
What about traditional banks and fintechs?
The banks – late to the party as usual – are finally waking up to the opportunity. Visa’s own white paper suggests banks can leverage stablecoins to:
- Improve cross-border money movement.
- Power innovative on-chain financial services.
Mastercard, Stripe, BBVA and even Standard Chartered are now experimenting with stablecoin rails. The shift is from an adversarial stance (“crypto bad”) to strategic adoption (“how can we use this?”).
Many fintechs, meanwhile, are natively embracing stablecoins – using them to circumvent costly intermediaries, embed new services and expand global reach.
How Can Family Offices Benefit from Stablecoin Development?
Now to the big question: why should a discerning family office care?
There are several angles:
Operational Efficiency
- Faster and cheaper cross-border payments for global asset transfers, family expenses and philanthropic giving.
- 24/7 liquidity for capital markets participation.
Portfolio Diversification
- Exposure to early-stage companies building stablecoin infrastructure (rails, wallets, compliance layers, etc.).
- Participation in yield-bearing stablecoin strategies.
Treasury Management
- Use of regulated, fiat-backed stablecoins as a short-term cash management tool, earning yields above bank deposits.
Strategic Optionality
- Staying close to next-generation financial infrastructure — useful intelligence for long-term planning.
Will stablecoins alter the current financial services landscape?
Short answer: yes – but evolution, not revolution.
- Payments – enabling instant cross-border payments.
- Treasury – providing programmable liquidity.
- Banking – pushing banks to modernise legacy systems.
As one executive put it, stablecoins are the “room-temperature superconductors for financial services”.
Risks associated with the development
No free lunches here. Family offices (and others) should be aware of risks:
- Regulatory risk – Compliance requirements vary globally.
- De-pegging risk – Some stablecoins (esp. algorithmic ones) have historically lost their peg.
- Counterparty risk – Trust in the issuer’s reserves and processes is key.
- Operational risk – Blockchain technology is still maturing.
- Market risk – Rapid innovation can create winner-takes-most dynamics.
Due diligence remains critical.
Conclusion
In short, stablecoins are no longer niche. They’re becoming an integral part of the modern global financial stack.
For family offices, they offer:
- New payment efficiencies.
- Attractive investment opportunities.
- A window into the future of finance.
The big picture? As one commentator noted: “If stablecoins were a country, they’d already be one of the largest holders of US debt.” This is not a sideshow anymore.
Of course, this is not an “all in” moment – but it’s certainly time for family offices to develop a thoughtful strategy, build internal knowledge and start exploring the space.
After all, we’ve seen this movie before. The internet was once “just for hobbyists.” Look where we are now.
