Original Article Title: "How Stablecoins Are Transforming Global Trade Beyond Sanctions"

Original Source: Tiger Research Reports

Key Points Summary

· Russia's use of stablecoins in oil trading demonstrates that stablecoins are no longer a fringe tool — they have become real financial infrastructure in high-risk cross-border commerce.

· Despite domestic cryptocurrency restrictions in China and India, they have benefited from stablecoin transactions with Russia, quietly experiencing the efficiency of decentralized finance at a national level.

· Governments around the world are responding in different ways, but all acknowledge that stablecoins are reshaping the way value moves across borders.

1. The Emergence of Stablecoins as a Strategic Currency Under Sanctions

The global significance of stablecoins is growing, not only as a speculative tool but also as a practical financial tool — first for individuals, then institutions, and now entire nations. The rise of stablecoins began in the crypto-native environment, where traders use stablecoins like USDT and USDC for trading, efficient capital transfers, and liquidity provision on centralized and decentralized platforms. Especially in markets with limited banking infrastructure or capital controls, stablecoins enhance access to the US dollar.

Subsequently, stablecoin adoption expanded to institutional and B2B use cases. Companies started using stablecoins for cross-border payments, supplier settlements, and payroll, especially in emerging markets where traditional banking services are unreliable or costly. Compared to wire transfers through SWIFT or correspondent banks, stablecoin transactions settle almost instantly, without intermediaries, significantly reducing costs. This makes stablecoins not only efficient but also increasingly essential for companies operating in politically or economically unstable regions.

Now, stablecoins are being tested at the national level, with their role shifting from convenience to strategic importance. Faced with sanctions or seeking alternatives to the US-dominated financial system, countries like Russia have turned to using stablecoins. As stablecoins transition from a corporate tool to a trade tool at the national level, their role has evolved from operational convenience to political necessity. This report will explore, through real-world case studies, how stablecoins are being used to circumvent restrictions, reduce costs, and open new trade routes.

2. Practical Applications of Stablecoins: How Global Trade Is Quietly Adapting Behind the Scenes

Source: Statista

Russia is increasingly incorporating stablecoins such as USDT and major cryptocurrencies like Bitcoin and Ethereum into its oil trading with China. According to a March 2025 Reuters report, this represents a strategic effort to circumvent Western sanctions. The trading pattern is relatively simple. Chinese buyers transfer domestic currency (such as the Renminbi) to an intermediary, who then converts it into stablecoins or other digital assets. These assets are then transferred to Russian exporters, who later convert the funds into Rubles. By bypassing Western financial intermediaries, this process reduces sanction risks and enhances transaction resilience.

Among the digital assets used in these transactions, stablecoins play a particularly crucial role. While Bitcoin and Ethereum are occasionally used, their price volatility makes them unsuitable for large transactions. In contrast, stablecoins such as USDT provide price stability, high liquidity, and ease of transfer, qualities that support their growing role in cross-border settlements in restricted environments.

It is worth noting that China continues to impose strict restrictions on domestic cryptocurrency use. However, in the context of energy trade with Russia, authorities seem to adopt a tolerant stance towards stablecoin transactions. Although not formally endorsed, this selective tolerance reflects pragmatic priorities, particularly the need to maintain commodity supply chains under geopolitical pressures. This dual posture—regulatory caution combined with practical engagement—highlights a trend: even within officially restrictive regimes, digital assets are quietly being adopted for their operational utility. For China, settlement based on stablecoins offers a way to bypass the traditional banking system, reduce reliance on the U.S. dollar, and ensure trade continuity.

Source: Chainalysis

Russia is not alone. Other sanctioned countries, such as Iran and Venezuela, are also turning to stablecoins to maintain international trade. These examples indicate that stablecoins, as a tool to sustain business functions in politically restricted environments, are seeing increased adoption. Even as sanctions ease over time, settlement based on stablecoins may continue to be used. The operational advantages—faster transaction speeds and lower costs—are particularly significant. With price stability becoming an increasingly crucial factor in cross-border trade, more countries are expected to intensify discussions on the adoption of stablecoins.

3. Global Stablecoin Momentum: Regulatory Updates and Institutional Shifts

Russia has particularly experienced the practicality of stablecoins firsthand. After the U.S. froze wallets associated with the sanctioned exchange platform Garantex, Russian finance ministry officials called for the development of a Ruble-backed stablecoin—a domestic alternative that reduces reliance on foreign issuers and protects future transactions from external control.

Apart from Russia, several other countries are also accelerating the exploration of stablecoin adoption. While Russia's primary motivation is to circumvent external sanctions, many other countries see stablecoins as a tool to enhance monetary sovereignty or more effectively respond to geopolitical changes. The attractiveness also lies in the potential for faster and cheaper cross-border transfers, highlighting stablecoins' role as a driver of modernizing financial infrastructure.

· Thailand: In March 2025, the Thailand Securities and Exchange Commission approved the trading of USDT and USDC.

· Japan: In March 2025, SBI VC Trade partnered with Circle to launch USDC, receiving regulatory approval from the Japanese Financial Services Agency (JFSA).

· Singapore: In August 2023, a regulatory framework was established for a single-currency stablecoin (pegged to the Singapore dollar or a G10 currency), allowing issuance by both banks and non-banks.

· Hong Kong: In December 2024, a stablecoin bill was announced, requiring issuers to obtain approval from the Hong Kong Monetary Authority; a regulatory sandbox is in progress.

· United States: No comprehensive legislation yet. In April 2025, the SEC stated that fully backed stablecoins like USDC and USDT are not securities. In March 2025, the Senate Banking Committee passed the GENIUS Act aimed at regulating payment stablecoins. USDC and USDT continue to be widely used.

· South Korea: Major domestic banks are preparing to jointly issue the first Korean won stablecoin.

These developments reveal two key trends. Firstly, stablecoin regulation has moved beyond conceptual discussions, with governments actively shaping their legal and operational parameters. Secondly, geographical differentiation is emerging. Countries like Japan and Singapore are driving the integration of regulated stablecoins, while countries like Thailand are taking stricter measures to protect domestic currency control.

Despite this differentiation, there is a global recognition that stablecoins are becoming a permanent part of the global financial infrastructure. Some countries see them as a challenge to sovereign currencies, while others view them as a faster, more efficient global trade payment tool. Therefore, the importance of stablecoins in regulatory, institutional, and commercial realms is on the rise.

4. Stablecoins Are Not a Stopgap Measure—They Are a New Layer of Financial Infrastructure

The growing use of stablecoins in cross-border transactions reflects a fundamental shift in financial infrastructure, not just an attempt to evade regulation. Even countries historically skeptical of cryptocurrencies, such as China and India, are beginning to indirectly leverage stablecoins in strategic commodity trading, experiencing firsthand their practical utility.

This development goes beyond sanctions evasion. What started as a retail-level experiment has evolved into institutional and even national-level integration, making stablecoins one of the few examples of real-world product-market fit in blockchain innovation. As a result, stablecoins are increasingly seen as a legitimate part of the modern financial system rather than a tool for illicit activities.

Viewing stablecoins as an element of the future financial architecture framework by institutions—rather than a temporary fix—may position them at the forefront of the next wave of financial innovation. Conversely, institutions that hesitate to participate may face the risk of passively adopting standards set by others. Therefore, policymakers and financial leaders must grasp the essence of stablecoins and their long-term potential, developing strategies aligned with the direction of global financial system evolution.

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