Original Title: "Cobo Stablecoin Weekly Report NO.13 | Payment Giants' 'Elephant Turn': Why Mastercard, Fiserv Embrace Stablecoins, How Will Traditional Card Organizations' Moats be Rewritten?"

In highly developed financial systems such as the United States, stablecoins struggle to bring significant efficiency gains; while in regions with inadequate financial coverage like Nigeria, Argentina, the Philippines, stablecoins have become a practical solution for cross-border payments and asset preservation. Tether has made a breakthrough in such "market failures," generating over $13 billion in profit in 2024. Today, Tether has proactively abandoned replicating the Southern Strategy in the U.S. and shifted towards building an AI wallet, IoT interface, and programmable payment SDK, exploring a new generation of the "digital operating system."

If Tether's strategy embodies the adaptive nature of stablecoins to different financial landscapes, then the moves by Mastercard and Fiserv signify that traditional institutions are strategically absorbing stablecoin capabilities in response to the structural trend of stablecoin annual transaction volume surpassing $27.6 trillion, overtaking the sum of Visa and Mastercard. Meanwhile, regulatory risks are escalating: a SlowMist report revealed that "Huobi Payment" on the TRON network is suspected of being involved in an illegal fund flow of over 500 billion USDT, exposing its systemic risk; Russia is accelerating the establishment of its national stablecoin and a cross-border payment network with independent exchanges, aiming to bypass the SWIFT and USD system.

Stablecoins are becoming the nexus of industry opportunities, geopolitical competition, and regulatory reshaping.

Market Overview and Growth Highlights

The total market capitalization of stablecoins reached $252.937 billion, with a weekly increase of $1.165 billion. In terms of market distribution, USDT continues to maintain its dominant position with a share of 62.57%; USDC ranks second with a market capitalization of $61.37 billion, accounting for 24.26%.

Top Three Networks by Stablecoin Market Value Distribution:

Ethereum: $125.685 billion

Tron: $80.794 billion

BSC: $10.474 billion

Top 3 Networks with the Fastest Weekly Growth:

Movement: +25.43% (USDC accounts for 64.15%)

Algorand: +17.44% (USDC Share 96.55%)

Sei: +16.34% (USDC Share 83.30%)

Data source: DefiLlama

Settlement as Power: How Mastercard is Redefining Card Network Moats with Stablecoins

With regulatory frameworks for stablecoins like the GENIUS Act becoming clearer, traditional financial institutions are adjusting their digital asset strategies. In the previous weekly report, we focused on Tether, Circle, and banks and speculated on their outcomes under the new regulations. In this issue, we shift our focus to card network giant Mastercard, exploring how they are leveraging a stablecoin strategy to transform from a traditional "network orchestrator" to a core coordinator of on-chain value transfer.

By 2024, the annual transaction volume of stablecoins surpassed that of Visa and Mastercard for the first time, significantly challenging the moat of the traditional card networks. Mastercard has clearly recognized that maintaining a monopoly position long-term is no longer sustainable solely through clearing rules and fees. Mastercard's latest strategic move involves shifting itself from the "consumer support mid-tier" to the starting point of the user's on-chain journey: collaborating with Chainlink, Shift4, Zerohash, and Uniswap to integrate bank card payments with on-chain settlement. This circumvents the cumbersome process of buying cryptocurrencies on centralized exchanges and directly bridges the fiat-to-on-chain asset conversion loop.

If Mastercard's previous initiatives, such as launching a crypto debit card with Kraken and partnering with MoonPay to support merchants accepting stablecoin payments, focused on penetrating the "mid-tier" of the crypto payment process and facilitating the circulation and consumption of existing assets, this collaboration implies that Mastercard is now participating in the initial stage of fiat-to-crypto asset conversion, namely the construction of the on-chain asset on-ramp. This is a more aggressive step aimed at achieving conversion at the user journey's starting point.

Mastercard's greater ambition is to penetrate the layer of funds' "final settlement." In the traditional fiat system, the final settlement of funds is led by commercial banks and central banks, and Mastercard only controls the instructions and clearing logic. However, in the stablecoin-driven payment network, it is seeking to take over more underlying processes: through the Mastercard Move platform, it provides stablecoin minting and redemption services to enterprises and financial institutions; by partnering with Paxos (USDG), Fiserv (FIUSD), and PayPal (PYUSD), it is establishing an on-chain wholesale settlement network to gain coordination and revenue-sharing rights in institutional stablecoin transactions.

Mastercard's core judgment is: the closer one is to settlement, the more they can determine the direction of value flow and distribution. In the era of blockchain, there is more of a reclamation of governance over payments and control over technical standards. From the information flow instruction layer to the value flow settlement layer, Mastercard's stablecoin strategy is a restructuring of its "platform power."

Tether's Bet on Emerging Markets and Programmable Finance

In the previous Stablecoin Weekly Report, we mentioned that the "GENIUS Act" set a "orderly delisting" timeline for USDT in the U.S., forcing Tether to either exit compliant platforms and focus on the "Global South." This week, Tether CEO Paolo Ardoino's remarks on the Bankless podcast further confirmed the strategic logic behind this shift. He pointed out that in the U.S., where financial efficiency has reached 90%, the marginal improvement stablecoins can bring is limited, making it difficult to sustain a profitable model, ultimately leading to price wars and "burnout." Conversely, in emerging markets where financial efficiency is only about 20% (such as Nigeria), if stablecoins can increase efficiency to 50%, the 30% structural gain can support a stablecoin premium. In extreme cases (potentially facing issues like severe local currency fluctuations), local users may even be willing to let Tether retain their interest income.

Therefore, Tether has abandoned the idea of replicating its "Global South" business model in the U.S. and shifted towards a new path centered around yield farming (similar to tokenized money market funds) and programmability: including creating an AI agent wallet, integrating IoT devices, opening a cross-chain wallet SDK, and restructuring its distribution network through channels like Rumble.

The divergence in Tether's "two different strategies" reflects the differentiated fate of stablecoin business models in different financial environments. In the U.S., where financial efficiency is at its peak, the adoption of stablecoins may need to transcend the traditional narrative of "cost and speed" and instead focus on profit sharing, programmability, and deep integration into new economic scenarios. Its continued expansion in Global South markets confirms that "addressing market failures" is the eternal rule for stablecoins to achieve product-market fit. This game about the future of money is just beginning.

SlowMist: HuionePay Processed Over 50 Billion USDT on the TRON Chain, Funds Display Typical Illicit Features

In the latest analysis by on-chain anti-money laundering platform SlowMist, an encrypted platform named "HuionePay" was revealed to be involved in large-scale illicit fund flows, having processed over 500 billion USDT through the TRON chain in the past year and a half, displaying several typical high-risk features.

On-chain data shows that the platform experienced a net outflow of funds of up to 2.771 billion USDT, with withdrawal transaction volume peaking at 150,000 transactions per day in May 2025, far exceeding deposit frequency during the same period, reflecting a rapid fund transfer pattern known as "high-frequency withdrawal." This behavior is highly consistent with illegal activities such as fraud fund laundering and fund flight.

Despite doubts about the platform's nature, the number of active deposit addresses continues to grow, exceeding 80,000 in total, demonstrating its continued appeal to a specific user base. Multiple core withdrawal addresses processed amounts totaling billions of USDT and have on-chain interactions with addresses on the OFAC sanctions list and known attackers (such as the BingX hacker), indicating a high concentration of funds that are traceable, highlighting a direct link to underground fraud networks.

Of note, the report suggests that multiple key addresses may be controlled by "Haowang Guarantee" (formerly "Huiwang Guarantee"), revealing a broader Southeast Asian scam network. Fund activity is concentrated between UTC 03:00–13:00, aligning with the region's working hours, further confirming the alignment of its geographical location and behavioral patterns.

On-chain intelligence also reveals the critical role of regulatory coordinated actions, including asset freezes by Tether, FinCEN intervention, Telegram channel bans, a joint report by the United Nations Office on Drugs and Crime (UNODC) and Elliptic, among others. These actions ultimately led to Huiwang announcing its cessation of operations, becoming a typical case of "multilateral containment" in the stablecoin field.

This event once again highlights the systemic risk exposure of USDT on the TRON network and reinforces the strategic value of on-chain tracking tools (such as MistTrack) in identifying illegal fund flows and coordinating law enforcement efforts.

Market Adoption

Mastercard Fully Embraces Stablecoins, Integrating the Three Major Stablecoins: Paxos, Fiserv, and PayPal

Key Highlights

Mastercard announced the integration of PayPal's PYUSD, Paxos-led USDG, and Fiserv's newly launched FIUSD into its global payment network, expanding its existing support for the Circle USDC ecosystem;

The payment giant will collaborate with Fiserv to introduce FIUSD into card products, on-chain/off-chain channels, and merchant settlement systems, and join the Global Dollar Alliance behind the USDG stablecoin;

Mastercard will support cross-border stablecoin transactions through the Move service and allow consumers to use both fiat and stablecoin balances in a single interface through One Credential technology.

Why It Matters

This series of measures represents global banks and payment giants accelerating their embrace of stablecoins, a $2.6 trillion value and rapidly growing asset class. With the U.S. Senate passing the GENIUS Act to provide a regulatory framework for the stablecoin industry, institutional adoption is picking up pace. Mastercard's Chief Product Officer Jorn Lambert stated: "While most scenarios consumers will still be using fiat and Mastercard, regulated stablecoins are undoubtedly part of the digital payment evolution." Mastercard's initiatives mean that financial institutions and businesses will soon be able to mint, redeem, and settle specific stablecoin transactions, while consumers can transfer and pay with stablecoins just like traditional currencies, including at 1.5 billion global merchant locations. These integrations will bring stablecoin payments closer to mainstream financial services, significantly enhancing their utility and adoption.

Chainlink and Mastercard Partner to Enable Nearly 3 Billion Cardholders to Buy Cryptocurrency Directly On-Chain

Key Takeaways

Chainlink and Mastercard have announced a collaboration to enable over 3 billion Mastercard cardholders to directly purchase cryptocurrency on-chain; the service integrates multiple participants: Shift4 processes card payments, zerohash holds fiat and provides crypto liquidity, XSwap and Uniswap execute final token exchanges in decentralized markets; Chainlink's interoperability protocol connects these steps, passing transaction data between the card network and multiple blockchains.

Why It Matters

This partnership is the latest move in Mastercard's deepening involvement in cryptocurrency, following closely behind its collaborations with MoonPay and Kraken. Mastercard's Blockchain Head Raj Dhamodharan stated that the company aims to "bridge the gap between on-chain commerce and off-chain transactions." Chainlink co-founder Sergey Nazarov emphasized that this partnership establishes a "crucial connection between the traditional payment world and Mastercard's user base of over 3 billion cardholders." This move will greatly simplify the process for mainstream users to purchase cryptocurrency, eliminate barriers such as traditional exchange registration and identity verification, bring a potentially massive new user base to the cryptocurrency market, and also signify a significant increase in traditional payment giants' acceptance of blockchain technology.

Finance and Blockchain Giant Fiserv Announces Launch of FIUSD Stablecoin, Targeting Global Financial Institutions

Key Highlights

Fiserv plans to launch the US dollar-pegged stablecoin FIUSD and a digital asset platform by the end of 2025, aiming to provide digital asset services to its network of 3,000 regional and community banks and 6 million merchants;

FIUSD will be deployed on the high-performance Solana blockchain and will feature deep integration with industry leaders such as Mastercard, Circle, Paxos, and PayPal. Fiserv's banking clients will be able to onboard at "zero additional cost" and reach over 1.5 billion merchants globally instantly through Mastercard's multi-rail network;

FIUSD will empower smart contracts, automated compliance, and 24/7 operation, capabilities that traditional banking systems find hard to match. Fiserv is transitioning from a reliance on high transaction fees to a new revenue model based on reserve asset yield, low-value fee sharing, and customer retention. This signals a shift in the entire payment industry from high-profit transactions to a low-margin, high-volume model.

Why It Matters

This move signals a strategic "embrace" of stablecoins by a traditional financial giant. In the face of stablecoin transaction volumes surpassing $27.6 trillion in 2024 (surpassing the total of Visa and Mastercard), Fiserv's actions are seen as a "damage control" of traditional high-profit payment models. By offering stablecoin services, it aims to retain customer deposits and establish a presence in the digital asset ecosystem. This move aligns with the market's demand for instant, composable financial services, forcing traditional giants to adapt.

PwC Releases Hong Kong Web3 Blueprint, Establishes Five Action Task Forces

Key Highlights

PwC and Web3 Harbour jointly released the "Hong Kong Web3 Blueprint," focusing on five key driving factors: talent, market infrastructure, standards, regulation, and funding contribution;

PwC Hong Kong partner Peter Brewin announced the formation of five specialized action task forces in August, each focusing on stablecoins, fund management, virtual asset trading platforms (VATP), legal compliance, and custody of OTC trading;

The blueprint emphasizes decentralized transparency, security, and user empowerment, aiming to provide systematic guidance and support for the development of the Hong Kong Web3 industry.

Why It Matters

The "Big Four" accounting firms are actively involved in Hong Kong's Web3 strategic planning, indicating that professional service firms are accelerating their entry into the digital asset ecosystem to drive industry standardization.

Korean Payment Giant Kakao Pay Applies for KRWKP Stablecoin Trademark

Key Takeaways

Kakao Pay has submitted 18 trademark applications related to "KRWKP" to the Korean Intellectual Property Office, covering stablecoin names, payment settlement, and cryptocurrency wallet services categories;

Market analysis suggests that this move may be Kakao Pay's preparation for launching its own Korean won stablecoin, demonstrating its intention to enter the crypto payment field;

The company's official response stated that the trademark registration is merely a precautionary measure to protect against future business possibilities, and there is currently no specific stablecoin issuance plan.  

Why It Matters

Mainstream Korean payment platforms showing interest in stablecoins indicate that Korean fintech giants are actively positioning themselves in the digital asset payment sector.

Cenoa Partners with Bridge to Unlock Global Opportunities for Emerging Market Entrepreneurs, with Stablecoin as a Key Tool

Key Takeaways

The Cenoa platform provides blockchain-based financial infrastructure for entrepreneurs in emerging markets (such as Turkey, Nigeria), addressing global payment needs that traditional banking systems cannot meet;

Through a partnership with Bridge, Cenoa users can instantly obtain a virtual USD account, with funds automatically converted to USDC and deposited into their wallets, bypassing the delays, high exchange rate markups, and restrictions of traditional banking systems;

Compared to traditional services like PayPal, Wise, etc., Cenoa offers an 80% lower cross-border payment fee, reducing the total cost by nearly 10 times, attracting over 10,000 users in Turkey within six months, with a monthly transaction volume exceeding $5 million.

Why It Matters

E-commerce sellers and freelancers in emerging markets need USD accounts to participate in global trade (such as selling on Amazon or receiving payments through Upwork), but the traditional account opening process is slow and costly. Cenoa addresses this pain point using stablecoin infrastructure, reducing customer onboarding time to less than 3 minutes and increasing transaction volume by 30 times. This partnership showcases the practical application value of stablecoins as an economic inclusion tool, not only solving the up to 8% forex fee issue but also providing emerging market users with an opportunity for fair participation in the global economy. Leveraging blockchain technology and stablecoins, Cenoa is helping millions of emerging market entrepreneurs overcome systemic barriers, lifting them out of poverty and putting them on an equal footing with their Western counterparts.

Ethereum Stablecoin Users Surpass 750,000, Reaching an All-Time High

Key Highlights

Weekly active users of major stablecoins on the Ethereum network, such as USDT, USDC, BUSD, and DAI, have exceeded 750,000, hitting a record high. This milestone indicates that stablecoins have shifted from speculation to utility-driven adoption;

The supply of USDT on the Ethereum network has reached $73 billion, while USDC stands at $41 billion, together occupying the majority share of the $134 billion stablecoin market on the network;

Competition among stablecoin issuers has intensified, with efforts to attract users through reduced transaction fees, enhanced yield opportunities, and holder incentives, aiming to drive service improvement and innovation.

Why It Matters

The growth of stablecoin users reflects the trend of digital dollar adoption. As traditional financial institutions integrate stablecoin infrastructure, it will become a key component of digital commerce.

Rain and Toku Collaborate to Launch Global Stablecoin Payroll System, Covering 100+ Countries

Key Highlights

The stablecoin payment platform Rain has partnered with compliance service provider Toku to introduce a cross-border stablecoin payroll system, enabling enterprises to settle employee wages instantly in stablecoin form;

The system supports stablecoins such as Circle's USDC, Ripple's RLUSD, and Global Dollar's USDG, with additional options to be added based on customer demand and compliance assessments;

The platform seamlessly integrates with popular payroll systems like ADP, Workday, and Gusto, allowing enterprises to deploy within a week while complying with labor laws and tax regulations in over 100 countries.

Why It Matters

Stablecoins are rapidly expanding into real-world business use cases. The GENIUS Act advances regulatory clarity for the industry, and blockchain payroll payments can fundamentally transform traditional wage payment methods, enabling instant settlement upon work completion.

New Product Spotlight

Bitkit Introduces Bitcoin Payment Feature, Enabling Direct Settlement for Everyday Services Like Netflix

Key Highlights

Bitkit wallet app has added a Bitcoin direct payment feature, allowing users to now use Bitcoin directly to pay for services such as Netflix, Airbnb, groceries, mobile data, and other daily life services;

This feature eliminates the need for a bank intermediary, removes traditional payment friction, and streamlines Bitcoin's use in real-world scenarios;

Bitkit's move is aimed at promoting Bitcoin as a practical everyday payment tool, encouraging users to "take action and live on Bitcoin".

Why It Matters

The expansion of Bitcoin applications to daily consumer scenarios, lowering the practical cryptocurrency usage threshold, helps drive encrypted payments towards mainstream adoption.

Circle Announces USDC and Cross-Chain Transfer Protocol CCTP V2 Officially Landing on Codex Blockchain

Key Highlights

The USDC and Cross-Chain Transfer Protocol CCTP V2 are now live on Codex Blockchain, designed specifically for B2B stablecoin transactions;

Circle Mint and its API fully support USDC on Codex, enabling eligible enterprises to easily access USDC liquidity and benefit from Codex's fast and secure network advantage;

Codex is a new EVM blockchain focused on performance, compliance, and cost efficiency, aiming to bring more real-world commercial activities onto the chain, especially in the most challenging payment corridors.

Why It Matters

The launch of USDC on Codex will drive various enterprise-level use cases: enterprise stablecoin settlement, on-chain forex and multicurrency settlement, and cross-chain transfers. Through the CCTP V2 protocol, users can securely transfer USDC between Codex and other supporting chains in seconds, without relying on liquidity pools or third-party fillers. Eligible enterprises can apply for a Circle Mint account to access the USDC deposit/withdrawal channel on Codex, while small and medium-sized enterprises and individuals can access USDC services through the Circle partner network. This integration further expands the USDC ecosystem, providing enterprises with a regulatory-compliant digital dollar to accelerate payments, global settlements, and streamline financial operations.

Dynamic Launches "Stablecoin Accounts" and "Stablecoin Hub"

Key Highlights

Dynamic launches "Stablecoin Accounts," helping fintech and global payment teams launch stablecoin-based currency applications in a matter of days (rather than months);

This solution aims to address stablecoin infrastructure decentralization and cryptographic complexity issues, simplifying end-to-end wallet infrastructure, on-chain/off-chain channels, and payment processes.

The concurrently launched "Stablecoin Hub" is a free educational resource designed to help teams navigate the stablecoin ecosystem and become the preferred destination for stablecoin development learning.

Why It Matters

As the stablecoin market grows and institutional adoption increases, developing infrastructure has become a key pain point for the industry. Dynamic's new initiative directly addresses the technical barriers faced by fintech and payment teams when adopting stablecoins, aiming to accelerate the widespread use of stablecoin applications by simplifying infrastructure and lowering the development threshold.

Former Stripe Growth Lead Launches Borderless to Help African Diaspora Collective Investment in Startups and Real Estate

Key Takeaways

Joe Kinvi utilized the shares acquired through Stripe's acquisition of Touchtech Payments to establish the Borderless platform, facilitating collective investments by the African diaspora in hometown startups and real estate;

The UK-based platform has processed over $500,000 in transactions since its beta testing last year, with over 100 communities on the waitlist, supporting investment in over 10 startups and 2 Kenyan real estate projects;

Borderless addresses the primary pain points of cross-border collective investments: bank account freezes, currency mismatches, regulatory requirements, and authentication rules, by establishing trust through routing funds directly to validated sellers, escrow accounts, or lawyers.

Why It Matters

African diaspora remits billions of dollars to their home countries annually, but these funds are rarely invested in productive assets. Kinvi estimates that around $30 billion in migrant savings remains undeployed annually. Borderless provides compliant backend infrastructure that allows diaspora members to safely engage in collective investments, with a minimum investment of $1,000 for startups and $5,000 for real estate. The platform operates under the UK regulatory framework, ensuring the legal promotion of investment opportunities to diaspora members. Unlike remittance-focused platforms (such as Zepz, LemFi, and NALA), Borderless focuses on long-term investment solutions. The company has raised $500,000 in seed funding from DFS Lab, Paystack CTO Ezra Olubi, and executives from Stripe and Google.

SoFi Announces Return to the Crypto Space, to Launch Stablecoin-Based Cross-Border Remittance Service

Highlights

The U.S.-based fintech platform SoFi has announced that it will launch an international remittance service using blockchain and stablecoins, as well as resume cryptocurrency investment functionality;

The new remittance service will allow users to send U.S. dollars and specific stablecoins via a "well-known" blockchain network around the clock, with funds quickly converted into local currency and deposited into the recipient's account;

SoFi plans to relaunch cryptocurrency trading services later this year, allowing users to buy, sell, and hold major cryptocurrencies such as Bitcoin and Ethereum, with potential future expansions into services like staking and cryptocurrency-backed loans.

Why It Matters

In 2023, SoFi temporarily suspended all cryptocurrency-related services to obtain a banking license. Its return to the crypto space signals a financial technology company's renewed embrace of digital assets in a new, more crypto-friendly regulatory environment. The latest guidance from the Office of the Comptroller of the Currency (OCC) allows national banks to offer crypto custody and stablecoin-related services, providing regulatory support for SoFi's strategic shift. CEO Anthony Noto stated, "The future of financial services is being fundamentally reshaped by cryptocurrency, digital assets, and broader blockchain innovation." SoFi will leverage its Galileo platform to offer blockchain technology infrastructure to third parties, indicating that it not only sees crypto services as a new revenue stream but also as a key part of its overall strategic transformation.

Taurus Launches Industry's First Privacy-Enhanced Stablecoin Contract Built on Aztec Network

Highlights

Digital asset infrastructure company Taurus (with clients such as Deutsche Bank and Rothschild & Co) has launched the first privacy-enhanced stablecoin contract targeting financial institutions hesitant to use stablecoins due to privacy concerns;

The contract is built on the Aztec Network, a privacy-focused Ethereum Layer 2 network supported by a16z, combining zero-knowledge proof privacy protection with compliance features similar to USDC, including minting/burning control, emergency stop, etc.;

The new system allows companies to conceal employee names and amount information in cross-border payroll payments while retaining regulatory access when necessary. Taurus expects global stablecoin supply to reach $1-2 trillion by 2030.

Why It Matters

Privacy-enhanced stablecoins address a key barrier to institutional adoption. Against the backdrop of the GENIUS Act, innovative solutions that balance privacy protection and compliance requirements will accelerate stablecoin's application in corporate payments and treasury management.

Crypto Platform Kraken Launches Krak App, Directly Challenging Venmo and Cash App

Key Highlights

Cryptocurrency exchange Kraken announced on Thursday the development of a financial services app called Krak, allowing global users to transact nearly cost-free across borders with both crypto and fiat currencies;

The app will support over 300 assets and plans to introduce physical and virtual debit cards in the coming weeks, with the company also set to offer lending and credit services;

Krak users can earn rewards of up to 10% on specific digital assets, while holding the USDG stablecoin can yield up to 4.1% returns. Kraken does not charge transaction fees and does not stake customer assets.

Why It Matters

Crypto companies are rapidly developing banking-like services, blurring the lines between digital assets and fintech. This move by Kraken will directly compete with traditional financial apps like Revolut and Cash App, laying the foundation for revenue diversification ahead of its planned IPO early next year.

Regulatory Compliance

South Korea's Eight Major Banks to Establish Korean Won Stablecoin

Key Highlights

Eight major South Korean banks, including Kookmin Bank and Shinhan Bank, are jointly establishing a joint venture company to issue a Korean Won stablecoin. The project has entered the infrastructure discussion stage;

The project is being jointly pursued by the banks, the Open Banking and Decentralized Identifier Association, and the Korea Financial Telecommunications & Clearings Institute, with the earliest expected launch by the end of the year;

The team is considering two issuance models: a trust model (issuance after independent trust of customer funds) and a deposit-backed token model (directly pegged to bank deposits).

Why It Matters

The significant entry of traditional financial institutions into the stablecoin space indicates that institutional-grade stablecoin solutions are becoming a key focus of financial system innovation.

Hong Kong Accelerates Digital Asset Regulatory Landscape, Stablecoin Regulation to Commence in August

Key Highlights

Hong Kong Financial Secretary Paul Chan announced the issuance of 10 virtual asset trading platform licenses, with 8 more applications currently under review, while also finalizing the stablecoin legislation;

The "Stablecoin Regulation" will come into effect on August 1, making Hong Kong one of the first jurisdictions globally to establish a legal regulatory framework for stablecoins;

The Hong Kong Monetary Authority (HKMA) Chief Executive Eddie Yue stated that stablecoin issuance regulatory requirements are stringent, equivalent to e-wallet and banking regulatory standards. In the initial stage, only a few licenses will be issued, which will be used for specific scenarios such as cross-border trade.

Why It Matters

By clarifying the regulatory framework, Hong Kong is advancing both exchange licenses and stablecoin regulations, demonstrating its strategic positioning and competitiveness in establishing a regulated digital asset hub.

Hong Kong Releases Digital Asset Policy Manifesto 2.0, Aiming to Build a Global Digital Asset Innovation Hub

Key Takeaways

The Hong Kong SAR Government announced the "LEAP" framework, designating the Securities and Futures Commission (SFC) as the primary regulatory body for digital asset trading and custody services. The stablecoin regulatory regime will come into effect on August 1;

The government plans to standardize tokenized bond issuance (already issued HK$6.8 billion in tokenized green bonds), clarify the exemption of stamp duty for tokenized ETFs, and explore the use of stablecoins for government payments;

The manifesto clearly identifies the tokenization of real-world assets (RWA) as a key driver of market efficiency, promoting applications in various areas such as precious metals, renewable energy, etc. HKMA's Ensemble project will explore interbank tokenized deposit settlement.

Why It Matters

Through a unified regulatory framework and tax incentive measures, Hong Kong is building a comprehensive digital asset ecosystem, focusing on reshaping financial infrastructure and emphasizing the tangible benefits of digital assets to the real economy rather than speculation.

Bank for International Settlements: Stablecoins Fail Three Key Tests

Key Takeaways

The BIS report highlights that stablecoins have not passed three key tests of the monetary system: singularity, elasticity, and integrity, suggesting that they cannot be the cornerstone of the future monetary system;

The report states that although stablecoins have programmability, pseudo-anonymity, and cost advantages, they may disrupt national monetary sovereignty through "covert dollarization" and foster illicit activities;

The stock price of USDC issuer Circle dropped by 15% following the report's impact, after previously rising from an IPO price of $32 to $299, representing a more than 600% increase.

Why It Matters

Central bank representative bodies have rejected the status of stablecoins but acknowledged the transformative potential of traditional financial asset tokenization, implying future regulatory directions and policy attitudes.

Russia's Ruble-backed Stablecoin A7A5 Sees $9.3 Billion in Trading Volume in Four Months, Suspected of Sanctions Evasion

Key Highlights

A Financial Times investigation reveals that the Ruble-pegged stablecoin A7A5, launched by Moldovan oligarchs and a sanctioned Russian defense bank, has seen a trading volume of $9.3 billion since its launch in February;

A7A5 claims to be backed by Rubles held by Moscow's Promsvyazbank (a defense bank under US, UK, and EU sanctions), with a circulating token value of $156 million currently;

The company behind this stablecoin, A7, is controlled by fugitive Moldovan businessman Ilan Șor, who is under UK sanctions, with research linking him to Russian overseas political influence activities.

Why It Matters

Russia is actively developing cryptocurrency channels to circumvent Western sanctions, creating stablecoins for cross-border payments and building an alternative system outside Western-regulated stablecoins like USDT.

Macro Trends

Ondo CEO: Stablecoins Just the Tip of the Iceberg, Real-World Asset Tokenization Sector Matures

Key Highlights

Ondo Finance CEO Nathan Allman stated that Circle's successful IPO and the passage of the GENIUS Act have sparked a new wave of excitement in the blockchain space, with stablecoins being just the "tip of the iceberg" in the trend of real-world asset tokenization;

Ondo plans to launch a tokenization platform next month that will allow apps and wallets to provide on-chain access to publicly traded US equities, bonds, and ETFs, following the lead of BlackRock and Franklin Templeton in offering tokenized government bonds;

Allman predicts that "the vast majority of regulated financial assets will settle on the blockchain in the future," but believes that publicly traded liquid securities represent the "low-hanging fruit" of tokenization, while private market tokenization needs more time to mature.

Why It Matters

With Circle's stock price rising about 70% in a week, opening at $250, the heat in the tokenized asset market is increasing. Allman points out that while private market tokenization like loans has enormous potential, a significant amount of automation, digitization, and document standardization work is still needed before tokenization becomes mainstream. Companies like BlackRock and Apollo Global Management are working to create more liquidity for private market asset classes, which will help broaden the application of tokenization in the future. Allman emphasizes that tokenization alone does not make illiquid assets liquid, highlighting the practical challenges that real-world asset tokenization faces. The market will start with higher liquidity assets and gradually expand into the private market.

The Era of Real-Time Streaming Finance Has Arrived, Stablecoins Will Unleash Trillions to Reshape Business Models

Key Takeaways

The US dollar stablecoin has reached 1% of the US money supply (M2) and is growing at an annual rate of 55%, potentially reaching 10% of M1 within a decade;

Services on the blockchain are starting to resemble traditional banking services but with faster speed and lower costs, allowing businesses to adjust their cash management frequency from every two weeks to every 6 hours;

The real-time financial flow model will change how businesses manage cash: global cash holdings can be significantly reduced, employees can receive daily wages based on actual hours worked, and utility companies can bill on a daily basis instead of monthly.

Why It Matters

Paul Brody, EY Global Blockchain Leader, points out that as cross-border fund transfer costs approach zero and transactions are almost instant, companies can significantly reduce local cash buffers. US companies currently hold around $2 trillion in cash and $2.8 trillion in operating working capital loans, shifting to a financial flow model could unleash trillions of capital for new investments. With transaction costs on the Ethereum Layer 2 network now routinely below $0.01, the value of "float" saved per week is around $0.01, making more frequent cash management economically viable. This shift can not only eliminate inefficiencies such as payday loan institutions and 60-day delays in utility bills but also change behavior through instant rewards, creating more effective incentive mechanisms. Just as we have seen the evolution in the music industry from buying to downloading to streaming, the payments sector will also undergo a revolutionary transformation from "cost reduction" to "speed enhancement" to "reconstruction."

Bloomberg: Hong Kong Stablecoin Future May Be Linked to Real-World Assets like Real Estate

Key Takeaways

Bloomberg Industry Research has released a report analyzing the potential of the Hong Kong stablecoin market, pointing out that a stablecoin pegged to the Hong Kong dollar would still be influenced by the peg to the US dollar;

Analysts believe that during periods of adjustment in the currency board mechanism, even if the stablecoin's face value remains stable, the backing assets may need to be revalued;

The report predicts that in the future, Hong Kong's stablecoin is likely to be linked to real-world assets like real estate, rather than relying solely on fiat currency reserves.

Why It Matters

As an international financial center, Hong Kong linking stablecoins to real-world assets will create a new way of value circulation. A vast and tokenizable reserve of high-quality assets can drive the widespread adoption of Hong Kong stablecoins while unlocking the liquidity of high-value assets such as Hong Kong real estate. This trend aligns with the global wave of tokenizing physical assets, reflecting Hong Kong's forward-looking approach to exploring innovative financial products. As Hong Kong continues to advance its virtual asset regulatory framework, asset-backed stablecoins could become a crucial bridge connecting traditional finance and the digital economy, providing new momentum for Hong Kong to solidify its position as a hub of Asian crypto finance.

Paxos Chief Strategy Officer: Stablecoin Infrastructure Demand Surges, Banking Sector Exploring Tokenized Deposits

Key Takeaways

Paxos Chief Strategy Officer Walter Hessert stated that the company's stablecoin infrastructure demand has significantly increased, with Mastercard joining the Global Dollar Network being a manifestation of this trend;

Traditional financial institutions are actively exploring how to leverage the stablecoin payment rail, placing particular emphasis on its "extremely low cost and almost free" nature while seeking technology tools to meet compliance requirements;

Paxos has already issued $150 billion in stablecoins, and the banking sector's interest in deposit tokenization is growing, especially after the passage of the GENIUS Act in the Senate, with banks paying more attention to the interaction between deposit tokenization and stablecoins.

Why It Matters

Traditional financial institutions are beginning to realize the necessity of stablecoins and actively seeking ways to participate. Although the GENIUS Act does not support interest-bearing stablecoins, banks' interest in tokenized deposits is growing. Paxos's Global Dollar Network provides enterprises with the opportunity for "shared ownership and the sharing economy," helping institutions explore product-market fit, giving it a differentiation advantage in competition with Circle's USDC. Mastercard's joining of the Global Dollar Network indicates that the payment giant is supporting globally regulated stablecoin issuers, with Paxos as the behind-the-scenes technology provider driving these innovations to the market. The current stablecoin model has not yet fully met market demand, and financial institutions are seeking solutions to combine stablecoin payments with traditional wire transfers or real-time payment systems.

Tether CEO: Trillion AI Agents to Trade Using Bitcoin and USDT

Key Takeaways

Paolo Ardoino predicts that within 15 years, there will be 1 trillion AI agents using blockchain assets for settlement transactions, believing that traditional financial institutions like JPMorgan will not open accounts for AI agents;

Tether has already entered the AI field, launching the Wallet Development Kit (WDK), Tether Data, and the Tether AI platform to build self-custodial wallet infrastructure;

USDT currently holds over half of the global $2.43 trillion stablecoin market share, reaching $155 billion, with the U.S. Treasury Secretary stating that clear stablecoin rules could drive the industry's value to over $2 trillion by 2028.

Why It Matters

The emergence of AI Agent Economies could provide a whole new set of use cases for cryptocurrency, reshaping the payment infrastructure of machine-to-machine commerce.

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