Weekly Stable

The Weekly Stable (Vol 6)

This week's round up is a guest post by Chuk Okpalugo, Product leader at Paxos

Stripe founders, Patrick and John Collison discuss the implications of stablecoins on the All-In Podcast (ep 216)

This week's installment is a guest post written by Chuk Okpalugo, a Product leader at Paxos leading their stablecoin orchestration solutions.

(Don't forget your tickets to Stablecon in NYC on May 29th! Find us online at @thestablecon and linkedin/stablecon)

Hi stable subscribers,

Despite the rout in the crypto markets, stablecoin adoption steadily marches on, and the sheer amount of news to cover in this week’s roundup is testament to a rapidly growing industry that is increasingly becoming decoupled from crypto trading and price action.

We've had multiple stablecoin launches (including banks), strategy declarations from Robinhood, Bank of America and Paypal, and a slew of regulatory developments.

However, my personal goal is to help you get smarter on stablecoins, not just stay on top of the action. Trillions of GDP will be unlocked and billions of lives will be meaningfully improved if we transition to a better form of money storage and transfer.

It'll take awareness, understanding and entrepreneurial action to reach that outcome so whether you're building in the space, trying to find a new role in this growing market, or just curious to learn how you can adopt stablecoin payments in your business, I invite you to reach out. You can find me online on X, LinkedIn or Substack here.

With that being said, let's get into this week's top stories.

🏆 Top Stories

Global Dollar (USDG) launches on Solana!

USDG is a safe and trusted stablecoin issued by Paxos in Singapore and backed by Robinhood, Kraken, Anchorage Digital, Paxos, Bullish, Nuvei, Galaxy and other partners in the Global Dollar Network.

The adoption of stablecoins is driven by users, platforms and enterprises in the broader ecosystem, but today, the biggest issuers keep the lion’s share of the revenue. USDG changes that with a network model that allows partners to earn:

Up to 100% of the returns generated by assets backing USDG held on their platform
Additional revenue for minting, acceptance and more

The Global Dollar Network works together to drive adoption of USDG and is expanding rapidly, adding alfred, Caliza, Noah, Rain and Sling Money as the most recent partners.

Solana is the fastest growing blockchain for stablecoins, growing ~120% MoM to reach over $11B. With USDG on Solana, businesses, platforms and developers gain access to Solana’s fast settlement times, low fees and engaged community.

It’s a novel model, designed to reward companies that help drive global adoption. To find out more check out globaldollar.com

Regulatory debates heat up amid claims of lawfare

There’s a raging debate surrounding the ongoing drafting of stablecoin legislation. At issue is whether non-US issuers should access US treasury debt markets (the standard for USD stablecoin reserves).

Blocking this access is a blatant attempt at regulatory capture by US issuers according to Framework Venture’s Vance Spencer, and Tether CEO Paolo Ardoino agrees, going as far as claiming competitors (Circle) are using lawfare to “kill” USDT.

While there are some merits to limiting access (namely ensuring safe asset backing and consumer protection), these concerns can likely be addressed in an accommodative way that still enables foreign issuers to compete. After all, the biggest demand for USD stablecoins so far has come from outside the US and that demand pressure helps to lower US government borrowing costs.

That being said, if you've had to accept slower growth for following the rules as best you can, it might seem inherently unfair when your competitor (who grew much bigger by seemingly playing fast and loose) has an equal path to legitimacy via US debt markets.

Stripe’s stablecoin strategy

Stripe appeared on the All-in podcast last Friday and discussed, among many things, how they are thinking about stablecoins and contextualized their $1B acquisition of Bridge. In a nutshell:

It’s more than just payments, all money movement is shifting from manual to software-driven orchestration
Stablecoins are painkillers for cross border payments and users in emerging markets who want USD. Domestic systems probably aren’t going anywhere, but stablecoins will be the rail that connects them.
Tackling fraud and inefficient processes is a huge area to save businesses money. By acting as a “reputation network”, Stripe can differentiate. While stablecoins are a part of the vision, there's much more to transaction costs than just the rails themselves.

For a more detailed summary check out my breakdown here and watch the segment of the episode here.

Figure’s unique stablecoin approach

Figure’s launch of YLDS, the first SEC-registered yield-bearing stablecoin, deserves a special call out for their novel structure.

It’s a Face-Amount Certificate (a form of debt security)
Pays 3.8% annualised (as of today), accrues daily, pays out monthly (and can be automatically reinvested)
Transferable peer-to-peer to other onboarded users
Although limited to the Provenance blockchain today, they plan to make it available on other chains/DeFi protocols via bridging

For the fintech/securities nerds out there the S-1 is definitely worth a read (or chat with your favorite LLM).

They’ve been working on this for years and it’s impressive that they managed to get this live. However it remains to be seen whether this security structure will be competitive with the stablecoins that will be blessed under the new stablecoin legislation. That will likely come down to overcoming frictions in distribution, technical adoption within the broader ecosystem, liquidity and managing securities transfer restrictions.

The stablecoin legislation won’t be complete until much later in the year at the earliest so Figure still has some time to, er, figure it out.

That’s it for my top stories. Enjoy another week of stablecoin news below.

🚀 Product Launches

Figure Markets launched YLDS, the first SEC-registered yield-bearing stablecoin, with peer-to-peer transfers on the Provenance Blockchain

Moonwell, the DeFi lending platform, launched it’s Virtual Accounts in partnership with Bridge

Mural, the stablecoin powered cross border payments platform, launched their APIs, allowing developers to orchestrate cross border payments programmatically

Global Dollar’s USDG launches on Solana, crosses $100M in market cap and adds new partners

Bastion, the stablecoin issuance platform targeted at institutions, secures NY limited purpose trust charter through acquisition

Digital Asset and Euroclear launched the first phase of a tokenized collateral mobility initiative on the Canton Network, aiming to enhance efficiency in digital and crypto markets

Braza Group announces launch of BBRL stablecoin on the XRP ledger to enhance digital and cross-border payments, targeting institutional clients in Q1 2025

SocGen launches its euro-backed stablecoin on the Stellar blockchain

💸 Fundraises

Ethena announced December raise of $100M from private sale of ENA tokens to investors reportedly including Franklin Templeton, F-Prime Capital, and a Fidelity Investments affiliated venture capital firm

Tether backs stablecoin liquidity provider Mansa in $10M seed round

📰 Other News

Stablecoin Adoption

Coinbase states goal for a stablecoin on Base for every global currency, this year. Stablecoins for Canada, Nigeria, and Brazil all recently launched on Base

PayPal plans to integrate its PYUSD stablecoin into more products by 2025, targeting its 20 million merchants for vendor payments via a bill-pay product, aiming to enhance transaction efficiency

Robinhood plans a major crypto expansion under a Trump administration, leveraging a crypto-friendly SEC chair to diversify into tokenization, stablecoins, and global offerings, following a strong Q4 2024 performance

Bank of America to launch USD stablecoin if lawmakers pass legislation, CEO says. "It's pretty clear there's going to be a stablecoin, which is going to be a fully dollar-backed... it's no different than a bank account."

Stablecoin market capitalization on Solana reaches an all time high of $11.6B on Feb 24th, ~120% MoM growth

Regulatory Developments

Circle’s USDC and EURC became the first stablecoins recognized by Dubai’s DFSA in the DIFC, enabling their use in payments and financial applications

The turnaround of the SEC continues this week as they drop investigations and cases into Robinhood, Uniswap and Coinbase

The European Central Bank is developing a blockchain-based payments system, potentially leading to a digital euro, to enhance cross-border transactions and compete globally, with a two-phase rollout starting with integration into its existing infrastructure

EU’s MiCA approves 10 stablecoin issuers, Tether did not comply in time

Stablecoin wars intensify with accusations of regulatory capture emerging as Circle and Tether advocate opposing views on the future of U.S. stablecoin regulation

🍻 Upcoming Events

We're partnering with Will White, formerly of WalletConnect and Monzo, to host a monthly invite-only salon to meet up and discuss the fast-growing stablecoin ecosystem. See the link here: https://lu.ma/stablesalon

💼 Stable Job of the Week

💬 Posts of the Week

Update on stablecoin value capture

Pretty sure it's 1-2 apps (e.g. @SlingMoney ) and liquidity orchestrators that will capture most of the value aside from issuers (Circle, Coin)

On liquidity and FX - market is still wide open. Expect to see some big rounds there soon… https://t.co/7rrZ4lkEKn
— Bruno Werneck de Almeida (@brunoswerneck) February 20, 2025

I don't comment directly on regulation much but I would like to flag an emerging regulatory battle that is happening in D.C.

The soon-to-be revealed stablecoin markup apparently has requirements to shut off access to the treasury market to centralized international stablecoin…
— Vance Spencer (@pythianism) February 24, 2025