A New Milestone in the Digital Asset Market: Stablecoins Driving Fintech Innovation

Introduction

In 2025, the digital asset sector will witness an important breakthrough, as a financial technology company focused on stablecoin business successfully goes public on the New York Stock Exchange. This marks the official entry of the USD stablecoin ecosystem into the public capital market, opening up a new blue ocean for the digital asset industry. As a bridge connecting traditional currencies and digital currencies, stablecoins are becoming the core battleground for capital markets and financial technology companies, thanks to their price stability, efficient low-cost cross-border payment capabilities, and deep support for innovative scenarios such as DeFi.

Against the backdrop of rapid development of the global digital economy, the stablecoin ecosystem is experiencing explosive growth. Whether it is the influx of capital or the gradual improvement of policy regulation, both demonstrate the key position of stablecoins in the future global payment system, cross-border settlement, and asset management. This article will deeply analyze the ecological layout of a well-known stablecoin project, the compliance logic behind it, capital arbitrage opportunities, and global regulatory trends, comprehensively showcasing how stablecoins are triggering a capital frenzy in the digital asset field.

The Background and Value of the Rise of Stablecoins

Stablecoins, as a type of digital asset that is pegged to the value of traditional fiat currencies, have rapidly emerged in recent years and become an important component of the cryptocurrency market. Unlike the high volatility of mainstream digital currencies such as Bitcoin and Ethereum, stablecoins achieve price stability through a 1:1 peg to fiat currencies like the US dollar, significantly reducing the risks associated with digital asset trading. Utilizing blockchain technology, stablecoins not only enhance the efficiency of cross-border transfers and payments but also provide strong infrastructure support for diverse scenarios such as DeFi, digital asset exchanges, and global merchant collections.

The core advantages of stablecoins are reflected in three aspects:

1. Stable prices, avoiding volatility risks

The cryptocurrency market experiences significant price volatility, while stablecoins are pegged to fiat currency values, ensuring the stability of transaction and settlement amounts, thereby greatly reducing trading risks.

2. Cross-border transfers are fast and cost-effective.

Stablecoins are based on blockchain technology, enabling global transactions to be completed in just a few minutes, which is far lower than the time and fees associated with traditional bank cross-border remittances.

3. Support diversified financial applications

Stablecoins are directly integrated into innovative scenarios such as DeFi lending, asset exchange, and digital goods payments, greatly expanding the usage boundaries of digital assets.

These advantages are difficult for traditional fiat currencies to achieve, greatly enhancing the convenience and efficiency of digital asset trading.

A Well-Known Stablecoin Project's Ecosystem Layout

The project was established in 2013, focusing on digital payments and blockchain finance, and launched a USD stablecoin. This is a centralized stablecoin pegged 1:1 to the US dollar, with all funds reserved in regulated banks in the US and short-term government bonds, audited monthly by a third-party accounting firm to ensure the transparency and security of the reserve assets.

As of June 2025, the market cap of this stablecoin is approximately $39 billion, ranking it as the second largest stablecoin globally. Its ecosystem is extensive, having been deployed on multiple public chains including Ethereum, Solana, Arbitrum, Optimism, Avalanche, Base, and Polygon, supporting exchanges, DeFi protocols, high-speed payments, and cross-chain asset transfers.

The project implements stablecoin free flow across different chains without slippage through a cross-chain transmission protocol, practicing a globalization strategy.

In terms of compliance, the project strictly adheres to the regulatory requirements of the U.S. Department of the Treasury, SEC, and FinCEN, becoming a "stablecoin regular army" recognized by regulatory agencies. Transparent audit reports and a compliant reserve system make it an important foundation for the digital dollar ecosystem. At the same time, the project collaborates with global payment giants to actively promote the application of its stablecoin in the global payment and settlement fields.

Overview of Major USD Stablecoin Projects

| stablecoin | Issuer | Total Market Cap (as of June 2025) | Reserve Structure | Compliance Attributes | |-------|-------------------|----------------|--------------|--------------| | USDT | Some overseas company | Approximately $155.6 billion | US Treasuries, cash, repurchase, etc. | Partially transparent, has been penalized | | USDC | A certain American company | Approximately $61.47 billion | Cash + short-term U.S. Treasury bonds, clear audit | Fully compliant, cooperating with regulatory authorities | | FDUSD | A Hong Kong company | Approximately $1.481 billion | Bank deposits + short-term securities | Regulated under Hong Kong trust framework | | PYUSD | A certain payment giant + a certain blockchain company | Approximately $947 million | Custody, mainly US Treasuries | Subject to New York financial regulation | | USDe | A Singaporean company | Approximately $5.6 billion | Cashless, synthetic structure | No traditional collateral | | USD1 | Team supported by a certain politician | Approximately 2.2 billion USD | Fiat storage system | Third-party regulation |

Stablecoin Underlying Logic

In recent years, the stablecoin market has experienced explosive growth, driven by three core factors: regulatory vacuum, interest rate spread, and national competition. These factors work together to make stablecoins not only an important asset class in the digital currency market but also a new battleground for global financial capital.

1. Regulatory Vacuum --- From Barbaric Growth to Gradual Standardization

In the past, the issuance and circulation of stablecoins lacked clear global regulatory standards, leading to a "regulatory vacuum" in the market. This lack of regulation reduced the barriers to entry for issuance, attracting a large amount of capital and projects to enter quickly; on the other hand, it also brought potential systemic risks. As countries begin to introduce laws and regulations regarding stablecoins, such as Hong Kong's "Stablecoin Regulation" which will be officially implemented in August 2025, it brings institutional norms and protections to the market. This institutional shift not only injects confidence into industry development but also promotes the market to gradually move towards compliance and maturity.

2. Interest rate spread --- the "profit gold mine" in the eyes of capital

The issuer of stablecoins manages the fiat funds exchanged by users and invests them in low-risk short-term government bonds, pledges Ethereum (ETH), or employs various strategies such as short futures to achieve returns significantly higher than bank deposit rates. Taking a stablecoin from a certain Singapore company as an example, it achieved an annualized yield (APY) of over 20% through ETH staking and short futures strategies, making it highly attractive in the market. Once high returns are obtained, funds quickly pour in, creating a capital accumulation effect and rapidly expanding the scale of stablecoins.

3. National Game --- Currency Hegemony and the New Battlefield of Digital Economy

Stablecoins are not only financial innovation tools but also the focal point of international currency competition and digital sovereignty. A stablecoin launched by a team supported by a certain political figure attempts to create a "digital dollar reconstruction plan" to challenge the current digital hegemony of the dollar; meanwhile, Hong Kong is actively building a stablecoin ecosystem for the Hong Kong dollar, vying for a position in the Asian fintech landscape. Countries in Europe, America, and Asia are striving to maintain currency influence in the digital age through regulations and central bank digital currency (CBDC) pilots. Stablecoins have become a new battleground for countries around digital currency sovereignty and the global payment system.

4. The use cases are constantly enriching, gradually approaching the functions of fiat currency.

Stablecoins were initially used for internal transfers within cryptocurrencies, such as a certain well-known stablecoin that circulates widely in the crypto market. However, with the development of technology and the application ecosystem, the functions of stablecoins continue to expand:

• Global trading and payment: Supports cross-border e-commerce and overseas remittances, providing a fast and low-cost settlement method.

• DeFi Lending and Yield: Become a major lending asset on DeFi platforms, where users can lend stablecoins to earn interest or use them as collateral for assets.

• Asset hedging tool: During periods of extreme volatility in the crypto market, investors can quickly convert to stablecoin to lock in asset value.

• Digital goods payment: Stablecoins are widely used as a means of payment in areas such as gaming, NFTs, and content creation.

As these diverse scenarios continue to mature, the use of stablecoins is gradually evolving from "cryptocurrency tools" to "digital fiat currencies", resulting in a surge in market size and capital attention.

A New Global Currency Order is Taking Shape

From state-led initiatives and commercial bank pilots to participation from tech giants and on-chain native projects, stablecoins are transforming from a niche tool in cryptocurrency to a key gateway for the next generation of global payment infrastructure.

Many people are unaware that this wave of stablecoins is, in fact, a struggle among countries for "currency hegemony in the digital age."

As the United States continues to expand the influence of the dollar through stablecoins, Hong Kong is also actively building a stablecoin ecosystem to promote the construction of an Asian Web3 clearing center.

On May 21, 2025, the Hong Kong Legislative Council officially passed the "Stablecoin Bill" and completed the third reading procedure on the same day. The regulation will officially take effect on August 1, 2025, making it the first jurisdiction in the world to establish a comprehensive regulatory framework for fiat-pegged stablecoins.

Hong Kong's introduction of the "Stablecoin Regulation" is not a passive response to regulation, but rather a proactive consideration to seize the strategic high ground of the "next generation payment and clearing center":

• The initial form of the global cryptocurrency payment system has emerged, with stablecoins gradually expanding from "cryptocurrency settlement tools" to become the mainstream choice for cross-border remittances, payments, and asset hedging;

• Major economies are accelerating the digitization of currencies, and currency competition is shifting to the level of digital sovereignty. Hong Kong must establish a compliance moat to ensure the internationalization of the Hong Kong dollar;

• The integration of Web3 and finance is accelerating, and stablecoins are becoming the "bridge" and "medium" between on-chain applications and real-world assets, with Hong Kong aiming to be the capital of bridges.

Therefore, Hong Kong is not merely "plugging loopholes", but is finding a new positioning to proactively define rules between cryptocurrency and regulation. Hong Kong's long-term intentions are very clear:

• The digital Hong Kong dollar is led by the Monetary Authority, primarily through CBDC system settlements and pilot programs by financial institutions;

• The Hong Kong dollar stablecoin is market-driven and serves as a supplement or even a replacement in applications on the open chain, overseas payments, and cross-border settlements.

This dual-track approach will enable Hong Kong to hold two types of "issuance rights" in digital finance: one is official credit, and the other is commercial efficiency.

In this game of the new global currency order, stablecoins have quietly become the technical carrier and symbol of influence for the next sovereign tool. The United States anchors certain stablecoins to compete for settlement rights in the digital age; Europe and Japan promote an independent strategy for the digitalization of their local currencies through relevant regulations; meanwhile, Hong Kong has carved out an independent path of "market-driven, institutional support" with a flexible and forward-looking regulatory framework and a highly open market mechanism.

In the future, when stablecoins become the infrastructure for cross-border payments, and when blockchain redefines clearing networks and asset expressions, those who master the pricing power, access rights, and clearing rights of this system will gain the upper hand in the new round of international financial order. And Hong Kong has already taken the lead.

Stablecoins are not just a revolutionary form of currency, but a deep game of digital sovereignty, financial order, and geopolitical discourse. In the future, more cities and countries will join this unnamed digital financial war. However, at this moment, Hong Kong, standing at the card table, is no longer a bystander.