Original Title: Q2 2025: The State of Local Stablecoins (Non-USD) in Southeast Asia

Original Author: rafi, Crypto Researcher

Original Translation: Deep Tide TechFlow

Key Points

· Dominance of Stablecoins Pegged to the Singapore Dollar: XSGD is the sole issuer of a stablecoin pegged to the Singapore Dollar and holds a dominant position in the Southeast Asian local stablecoin market, leveraging partnerships with Grab and Alibaba.

· Market Indicators: Operating across over 8 EVM chains, with 8 issuers and support for 5 local currencies. In the second quarter of 2025, decentralized exchange (DEX) trading volumes reached $136 million (dominated by the Avalanche chain and the Singapore Dollar), a 66% decrease from the first quarter's $404 million.

· Regulatory Progress: The Monetary Authority of Singapore advances a stablecoin framework for the Singapore Dollar and SCS pegged to G10 currencies; Indonesia and Malaysia introduce regulatory sandbox experiments.

· Cross-Border Trade: In 2023, only 22% of Southeast Asia's trade occurred intra-regionally, with an overreliance on the USD leading to costly delays and fees. Local stablecoins can streamline settlement processes by offering instant, low-cost transfers and further accelerate through the ASEAN Business Advisory Council's regional QR code payment initiative.

· Financial Inclusion: Over 260 million people in Southeast Asia still lack access to or do not have a bank account. Once non-USD stablecoins integrate into super app wallets like GoPay or MoMo, they can expand affordable financial service channels for remittances, microtransactions, and day-to-day digital payments.

Southeast Asia's (SEA) GDP totals $3.8 trillion, with a population of 671 million. As the world's fifth-largest economy, competing with other economies and boasting 440 million internet users, it is driving digital transformation.

Against this backdrop of economic vibrancy, non-USD stablecoins and digital currencies pegged to regional or basket currencies have provided transformative tools for Southeast Asia's financial ecosystem. By reducing reliance on the USD, these stablecoins can enhance cross-border trade efficiency, stabilize intra-regional transactions, and foster financial inclusivity across diverse economies.

This article discusses why non-dollar stablecoins are crucial for Southeast Asian financial institutions and policymakers aiming to shape a resilient, integrated economic future.

Transaction

Source: https://dune.com/queries/5728202/9297229

Since January 2020, the adoption of non-dollar stablecoins in Southeast Asia has rapidly increased from an initial 2 projects to 8 projects by 2025. This growth has been driven by increasing transaction volumes and the use of diverse blockchain platforms.

In the second quarter of 2025, the transaction volume of non-dollar stablecoins in Southeast Asia reached 258,000 transactions, with stablecoins pegged to the Singapore Dollar (SGD), especially XSGD, holding a 70.1% market share, followed by stablecoins pegged to the Indonesian Rupiah (IDR) (IDRT and IDRX) at 20.3%. This reflects strong regional economic activity and regulatory support, highlighting their critical role in the Southeast Asian digital economy.

Source: https ://dune.com/embeds/5728202/9297229

Over the past four years, since 2020, the transaction volume of non-dollar stablecoins in Southeast Asia has exceeded 1 million transactions, driven by widespread adoption and strong exposure to EVM chains, leading to continuous quarterly market share growth. In the second quarter of 2025, Avalanche led with a 39.4% market share (101,000 transactions), followed by Polygon (83,000 transactions, 32.5%) and Binance Smart Chain (28,000 transactions, 10.9%). Avalanche's rapid rise is mainly attributed to the XSGD project, which is currently the only stablecoin operating on the Avalanche chain and has gained significant traction since its launch. XSGD is a stablecoin pegged 1:1 to the Singapore Dollar, issued by StraitsX. StraitsX is a major payment institution licensed by the Monetary Authority of Singapore (MAS).

Event Address

Source: https://dune.com/queries/5728541/9297706

Since the second quarter of 2025, non-dollar stablecoins in Southeast Asia have been widely adopted, with the number of active (trading) addresses significantly increasing to over 10,000, including 4,558 revisiting addresses and 5,743 new addresses, demonstrating a steady growth of stablecoin users and increased participation.

Source: https://dune.com/queries/5728383/9297467

Unlike the transaction volume that reflects the overall activity level, active (trading) addresses reflect user engagement and adoption rate. In the second quarter of 2025, among Southeast Asia's non-dollar stablecoins, Polygon led with a 39.2% share, followed by Binance Smart Chain (BSC) with a 23.1% share, and Avalanche with a 10.1% share.

Note: In the "Grouped by Chain" view, addresses conducting stablecoin transactions across multiple chains (such as Polygon and BSC) are counted separately on each chain, hence the total is higher than the "Ungrouped" view (deduplicated data).

DEX Trading Volume

Source: https://dune.com/queries/5748360/9327460

In the second quarter of 2025, DEX trading volume decreased by 66% from $404 million in the first quarter to $136 million. Avalanche led with 51% ($69 million), followed by Polygon at 33% ($45 million), and Ethereum at 9% ($12 million). This decline highlights the trend of blockchain moving towards scalability, where Avalanche and Polygon take the lead.

Source: https://dune.com/queries/5748398/9327527

As mentioned earlier, in the second quarter of 2025, the DEX trading volume, calculated in local currency, reached $132 million, with Singapore dollar-pegged stablecoins leading the way, dominating the Southeast Asian non-US dollar stablecoin market. Assets priced in Singapore dollars accounted for 93.1% ($127 million), followed by the Philippine peso (PHP) at 3.9% ($5 million), and the Indonesian rupiah (IDR) at 2.7% ($3.6 million). This highlights the dominant position of the Singapore dollar in regional DEX activity.

Southeast Asia Stablecoins: Opportunities and Challenges

Opportunities

· Enhancing Cross-Border Trade Efficiency

In 2023, intra-regional trade in Southeast Asia accounted for 22% of its total trade, but transactions often go through USD-based correspondent banks, resulting in high fees and delays of up to 2 days. Stablecoins pegged to Southeast Asian currencies offer a more efficient alternative, enabling almost instant settlement at a lower cost. Building on this, the ASEAN Business Advisory Council (BAC) has adopted cross-border QR code payments settled in local currency. Collaboration between the BAC and Southeast Asian stablecoin issuers is expected to further reduce remittance costs and improve exchange rates.

· Promoting Financial Inclusion

With 260 million people in Southeast Asia lacking access to banking or without bank accounts, non-US dollar stablecoins can address the financial services gap. Mobile-based stablecoin wallets integrated with platforms like Indonesia's GoPay or Vietnam's MoMo can facilitate low-cost remittances and small-value transactions.

Challenges

· Regulatory Uncertainty and Fragmentation

The diverse regulatory landscape in Southeast Asia has brought uncertainty to stablecoin issuers and users. Significant policy variations exist among countries, with Singapore being relatively progressive while others have stricter regulations, potentially leading to compliance challenges and uneven adoption.

Recommendation: Southeast Asian policymakers should collaborate to establish a unified regulatory framework for stablecoins, providing clear guidelines on licensing, consumer protection, and anti-money laundering (AML) compliance to build trust and consistency.

· Market Volatility and Currency Peg Risks

Stablecoins pegged to regional currencies are susceptible to the effects of local currency fluctuations, which could undermine their stability and user confidence. Inadequate reserve backing or poor management could further exacerbate risks.

Suggestion: Stablecoin issuers should maintain a transparent, fully-backed reserve and undergo regular independent third-party audits. Diversification of the pegged currency basket can also help reduce volatility risk.

Conclusion

By the second quarter of 2025, the Southeast Asia non-US Dollar stablecoin market saw significant growth driven by collaborations with Grab and Alibaba, led by the issuer XSGD pegged uniquely to the Singapore Dollar. Operating on over 8 EVM chains, it has 8 issuers and supports 5 local currencies. Decentralized Exchange (DEX) trading volume reached $136 million, mainly concentrated on Avalanche and the Singapore Dollar, but decreased by 66% from the first quarter's $404 million. The Monetary Authority of Singapore (MAS) advanced a stablecoin framework for the Singapore Dollar and G10 currencies, while Indonesia and Malaysia introduced regulatory sandboxes.

This growth highlights the potential of non-US Dollar stablecoins in Southeast Asia to enhance cross-border trade and financial inclusion. However, factors such as regulatory fragmentation, currency volatility, cybersecurity risks, and uneven digital infrastructure need careful management to achieve sustainable development.

Original Article Link

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