Stablecoins promise to help businesses move money faster, cheaper and more transparently.
But their path to legitimization and institutional adoption has been anything but fast, cheap or even transparent.
Still, over the past week, policy debates stretched across Washington, Brussels, Hong Kong and Beijing, underscoring how governments increasingly view stablecoins not as experimental FinTech instruments but as infrastructure with monetary implications.
At the same time, product launches and partnerships from institutions as varied as SoFi, Mitsubishi UFJ Financial Group, Circle and Paxos suggested that the commercial contest is no longer about whether stablecoins will exist, but about what kinds will dominate and where.
What appears to be emerging is a stratifying marketplace in which a small set of global transactional stablecoins consolidates liquidity and network effects, while a growing field of jurisdiction-specific and use-case-driven tokens competes to solve narrower problems, from confidential B2B settlement to domestic payment modernization.
The tension between these two trajectories of global standardization versus local customization is already becoming a defining feature of the sector’s next chapter.
Read more: CFOs Eye Stablecoins as Capital Tool, Not a Crypto Bet
A Policy Environment Defined by Competitive Containment
In Washington, stablecoin regulation once again became a proxy battle over the future shape of financial intermediation. Behind closed doors, banking groups pressed lawmakers to ensure that issuance remains tethered to insured depository institutions, arguing that allowing nonbanks to mint digital dollars risks creating shadow payment systems outside prudential oversight. Crypto-native firms countered that overbanking the model would smother innovation and entrench incumbents, transforming what was meant to be programmable money into little more than digitized deposits.
Across the Atlantic, European finance ministers framed stablecoins through the lens of “digital sovereignty,” a phrase that has gained renewed urgency as dollar-backed tokens continue to dominate global circulation.
The European Union’s Markets in Crypto-Assets (MiCA) regime has begun to operationalize that concern, encouraging euro-denominated stablecoins while imposing strict reserve and transparency requirements. Still, policymakers remain wary that private-sector euro stablecoins could struggle to gain traction against entrenched dollar liquidity.
Meanwhile, tensions in Asia highlighted how stablecoins are increasingly intertwined with regional monetary strategy. Hong Kong has accelerated its licensing framework to position itself as a regulated hub for tokenized finance, while mainland Chinese authorities continue to emphasize state-backed digital currency development while effectively banning privately issued tokens.
The region is effectively testing two different futures for digital money, market-driven versus sovereign-led.
See also: Why Banks Want to Issue Stablecoins
Product-Market Fit Replaces Stablecoins’ Quest for Supremacy
Earlier phases of the stablecoin race were defined by attempts to build a single dominant token capable of serving every conceivable use case. That ambition is now giving way to a more segmented understanding of demand.
- On Wednesday (Feb. 11), the stablecoin USAD was launched by a joint initiative involving Paxos and Aleo. USAD targets confidential B2B transactions, leveraging privacy-preserving technology to address commercial use cases where transparency can be a liability rather than an asset.
- On Friday (Feb. 13), Mitsubishi UFJ Trust and Banking Corp. announced plans to issue a stablecoin in fiscal 2026 to be used mainly for settlements between Japanese companies and their overseas units.
- On Tuesday (Feb. 10), stablecoin issuer Tether invested in LayerZero Labs, the development company behind a blockchain interoperability protocol that is also designed for agentic finance, letting artificial intelligence agents operate their own autonomous wallets and transact with stablecoins.
This reflects a broader realization across the sector: one stablecoin cannot optimize for trading, payments, corporate settlement, regulatory customization or even AI agents at the same time.
Meanwhile, PYMNTS examined some of the challenges facing wider crypto adoption this week in the latest installment of the “From the Block” podcast.
In the episode, Andrew Balthazor, associate and co-lead of the crypto asset disputes team at Holland and Knight LLP, said he regularly hears “heartbreaking stories” from victims of crypto scams, and in many cases, there is not much they can do to recoup their losses. The industry hasn’t yet found a solution to prevent criminals from exploiting the technology.
“The question isn’t whether blockchain rails are faster or cheaper,” PYMNTS reported Thursday (Feb. 12). “It’s whether the protections that make traditional finance trustworthy, such as the remedies, accountability and recourse, exist yet in crypto. Balthazor said they largely don’t.”
