Stablecoins gain ground as banks and apps push everyday use

Dollar-pegged digital tokens are moving from trading desks into everyday payments, payrolls and cross-border transfers as financial institutions and consumer apps expand support for stablecoins, reshaping how value is stored and moved in the crypto economy.

Stablecoins now account for a growing share of on-chain activity, reflecting demand for price stability amid swings in other digital assets. Market capitalisation has climbed sharply over the past year, crossing the $150bn mark and consolidating gains across the two largest tokens, while usage metrics show rising transaction counts tied to payments rather than speculative trading. Industry data indicates that transfers linked to remittances, merchant settlements and treasury management have outpaced decentralised finance activity, a shift that underscores a broader push into real-world use.

At the centre of this expansion are fintech firms and neobanks integrating stablecoins into consumer-facing products. Several digital banks now allow customers to hold dollar-pegged tokens alongside fiat balances, convert between them instantly, and send funds internationally at lower cost than traditional correspondent banking. Payroll platforms have added options for salary disbursement in stablecoins for contractors working across borders, while e-commerce merchants are increasingly accepting them to avoid card fees and chargeback risks.

This momentum reflects a simple proposition. By maintaining a one-to-one peg with major currencies, stablecoins offer crypto users protection from volatility while retaining the speed and programmability of blockchain rails. For users in countries with capital controls or volatile local currencies, dollar-linked tokens provide a digital alternative to bank deposits. For companies, they enable near-instant settlement, 24-hour operations and improved cash-flow visibility.

Regulatory clarity has also played a role in broadening adoption. In the United States, draft federal frameworks for payment stablecoins have advanced through Congress, setting standards for reserves, disclosures and supervision. In the European Union, the Markets in Crypto-Assets regime has taken effect, placing issuance and custody under licensing requirements and accelerating compliance among major providers. Similar rulebooks in parts of Asia and the Middle East have encouraged banks to pilot stablecoin-based settlement within regulated environments.

Issuers have responded by strengthening reserve transparency and diversifying backing assets. Leading tokens report holdings dominated by short-dated US Treasury bills and cash equivalents, with regular attestations designed to reassure users after past failures in the sector. Competition is intensifying as new entrants backed by payment companies and technology firms seek to carve out niches in regional payments and business-to-business transfers.

At the same time, traditional financial institutions are testing their own tokenised money. Several global banks have launched internal settlement tokens for moving funds between branches or corporate clients, while central banks continue to explore wholesale and retail digital currencies. Although these initiatives differ from privately issued stablecoins, they signal a convergence between blockchain infrastructure and mainstream finance.

Critics caution that growth brings new risks. Concentration among a handful of issuers raises concerns about systemic impact if a major token were to lose its peg. Dependence on US dollar assets exposes the ecosystem to shifts in monetary policy and regulatory decisions. Consumer protection advocates argue that clearer redemption rights and segregation of reserves are essential as usage spreads beyond sophisticated crypto users.

Despite these challenges, adoption indicators suggest that stablecoins are becoming embedded in financial plumbing. On-chain data shows sustained increases in transaction volumes linked to payments corridors in Latin America, Africa and parts of Asia, where fintech apps use stablecoins as a bridge between local currencies. Developers are building wallets that abstract away blockchain complexity, allowing users to send value using phone numbers or QR codes while settlement occurs in tokens behind the scenes.

Corporate treasuries are also experimenting. Multinational firms have begun using stablecoins to manage liquidity across subsidiaries, reducing reliance on slow international wires. In capital markets, tokenised funds and bonds increasingly settle in stablecoins, shortening settlement cycles and lowering counterparty risk.