5 years in the past, SpaceX launched Starlink, which has since grown into its greatest income driver, increasing to over 100 international locations. However as Starlink scaled, it confronted a significant hurdle: accepting funds in creating markets, the place conventional banking infrastructure is unreliable, sluggish, and susceptible to blocking transactions. Many native banks throughout Africa, Latin America and Asia battle with worldwide funds, forcing SpaceX to search for alternate options.
To bypass these challenges, SpaceX turned to stablecoins, a fast-growing methodology for cross-border funds already broadly utilized in rising markets. The corporate partnered with Bridge, a stablecoin funds platform, to just accept funds in numerous currencies and immediately convert them into stablecoins for its international treasury. This transfer positioned Bridge as a viable different to correspondent banks in markets the place conventional monetary programs fall quick. Quickly after, Stripe took discover, buying the startup for greater than $1 billion and solidifying Bridge’s status and driving up its valuation as an infrastructure participant, fixing inefficiencies in international finance.
The rise of stablecoins—now a $205 billion market—is pushed by real-world utility, not hypothesis, notably in rising markets the place probably the most compelling use instances unfold. Cross-border funds in these areas are sometimes sluggish and costly, involving a number of intermediaries. For instance, a textile producer in Brazil paying a provider in Nigeria might need to undergo a number of banks and forex exchanges, every including charges and delays. Stablecoins take away this friction, enabling cheaper, near-instant transactions.
Adoption and investor curiosity surge
This rising demand has led to large transaction quantity development for startups offering stablecoin cross-border options for companies in Africa and rising markets.
Yellow Card, which supplies a platform that lets customers convert fiat to crypto and again to fiat, doubled its annual transaction quantity to $3 billion in 2024 from $1.5 billion in 2023. Conduit, which permits stablecoin funds for import-export companies in Africa and Latin America, noticed its annualized TPV bounce to $10 billion from $5 billion. Lagos-based Juicyway, which facilitates cross-border funds utilizing stablecoins, has processed $1.3 billion in whole cost quantity so far.
Investor curiosity has additionally surged, with high enterprise companies backing stablecoin-powered fintechs focusing on these markets. Peak XV and HongShan, the companies that break up from Sequoia, co-led a $10 million seed spherical in KAST, a neobank that lets customers maintain and spend stablecoins. Sequoia itself was a main backer of Bridge. Yellow Card raised $33 million, led by Blockchain Capital. Conduit, which raised a $6 million seed spherical final 12 months, is finalizing one other spherical. In the meantime, QED Buyers led a $9.9 million funding in Cedar Cash, a stealthy fintech utilizing stablecoins for cross-border transactions. Initialized led an $8.5 million spherical in Caliza, which is bringing real-time transfers to Latin-America utilizing USDC. Tether itself invested a large examine in an African stablecoin infra and liquidity supplier, TechCrunch has discovered.
The pattern is obvious: stablecoins are not a crypto experiment—they’re changing into a core a part of monetary infrastructure in rising markets to maneuver cash globally. As adoption accelerates, the query will not be if stablecoins will remodel funds however how rapidly they’ll stand alongside—and even exchange—outdated monetary programs.
Some numbers replicate this shift. In keeping with a16z, sending $200 from the U.S. to Colombia through stablecoins prices lower than $0.01, in comparison with $12.13 utilizing conventional strategies. Fee platforms are adapting, making a lower albeit a smaller one than the standard middlemen rails. Stripe, as an illustration, now costs 1.5% for stablecoin transactions, 30% decrease than its commonplace card charges. Companies and people are additionally utilizing stablecoins as a hedge towards inflation and a extra steady retailer of worth, with USDT and USDC changing into essential instruments.
Functions outdoors cross-border and remittance
Whereas cross-border funds and remittances have pushed early adoption, stablecoins at the moment are gaining traction in client finance, payroll, and, partly, retail transactions.
This January, Brazilian unicorn Nubank launched a function rewarding USDC holders with a 4% annual return, following a tenfold improve in customer-held USDC final 12 months. Now, 30% of Nubank’s customers have USDC of their portfolios. Nubank joins different fintech giants like Venmo, Apple Pay, PayPal, Money App, and Revolut, which already allow in-app stablecoin transactions.
Past client financial savings, stablecoins are reshaping international payroll. As distant work expands, startups like Rise enable firms to pay contractors utilizing stablecoins. The platform lets companies pay in fiat whereas contractors obtain stablecoins like USDC or USDT, avoiding forex volatility. Final November, Rise raised $6.3 million in Sequence A, fueling its growth in stablecoin-powered payroll options.
“The market goes the place we’re constructing and it’s solely a matter of time till the large gamers get within the enviornment. They’ll supply stablecoins by partnering, buying, or constructing a crypto cost infrastructure,” Rise CEO Hugo Finkelstein informed TechCrunch.
And whereas retail adoption of stablecoins has been slower, however startups like Cashnote.io are testing options. The platform, developed by Korean fintech Korea Credit score Information and Web3 VC agency Hashed, permits retailers to just accept bank card and digital asset funds through a point-of-sale system. Retailers can course of funds utilizing stablecoins with out the restrictions of bank card limits and shoppers can use digital belongings for on a regular basis purchases.
Each companies are testing the platform within the Abu Dhabi World Market (ADGM), one of the crucial crypto-friendly regulatory environments globally. Cashnote.io is projecting to go dwell with retailers within the area over the approaching months, with UAE-based digital belongings infra supplier Fuze performing because the settlement accomplice. Fuze raised a $14 million seed in 2023.
But, regardless of stablecoins’ potential to streamline funds globally, issues stay. For one, critics warn that stablecoins may disrupt financial coverage. As they turn into extra widespread in international finance, some fear they may mirror previous issues about dollarization, the place economies rely too closely on the U.S. greenback as an alternative of constructing unbiased monetary programs.
Equally, their effectivity comes with trade-offs. Not like government-backed currencies, they depend upon personal firms like Circle and Tether to keep up their worth. These firms use money reserves, short-term securities, and different monetary belongings to maintain stablecoins pegged to the U.S. greenback. Nevertheless, the 2022 collapse of TerraUSD exhibits how weak stablecoins could be.
Regulatory shifts may make or mar adoption
Governments and regulators worldwide are paying consideration, and their actions will affect stablecoin adoption. Some areas like Abu Dhabi’s ADGM, for instance, have positioned themselves as crypto-friendly zones, enabling fintech companies to experiment with stablecoin funds. Hashed CEO Simon Kim says Cashnote.io may solely work within the area because of the area’s structured and supportive authorized framework.
“There’s hardly a authorities like Abu Dhabi that accelerates innovation from new challengers overseas like this,” Kim informed TechCrunch. “It has many sandboxes and authorities assist programs for testing progressive and new crypto infrastructure.”
Equally, the UAE made headlines final 12 months when a courtroom ruling permitted salaries to be paid in crypto, reinforcing the nation’s place as a world hub for digital asset innovation.
Africa presents a distinct present. In lots of instances, innovation strikes sooner than regulation, forcing policymakers to react solely after fintech proves its worth—simply as they did with cell cash, in line with Zekarias Amsalu, co-founder of one in every of Africa’s high fintech occasions. He believes regulators, somewhat than being overtly cautious, ought to embrace stablecoins as they already assist cut back cross-border switch and remittance prices by as much as 75%.
“In case you are prepared to formalize Franco Valuta [policy that allows the import of goods without using foreign exchange from a bank] when the greenback crunch bites, towards all actual dangers, why not think about formalizing stablecoins which are supplied by licensed exchanges with all transparency and compliance?” Amsalu posits.
Whether or not their stance modifications or not might depend upon how regulation shapes up within the U.S., which is contemplating new legal guidelines that might have a world influence on stablecoins: A strict regulatory method—although unlikely—may sluggish adoption and impose tighter monetary controls on issuers. Then again, a pro-stablecoin stance may encourage extra international locations to create clear licensing guidelines for digital belongings. “These are very sturdy indicators for buyers,” Finkelstein stated.
