5 years in the past, SpaceX launched Starlink, which has since grown into its largest income driver, increasing to greater than 100 international locations. However as Starlink scaled, it confronted a serious hurdle: accepting funds in creating markets, the place conventional banking infrastructure is unreliable, gradual, and susceptible to blocking transactions. Many native banks throughout Africa, Latin America, and Asia wrestle with worldwide funds, forcing SpaceX to search for alternate options.
To bypass these challenges, SpaceX turned to stablecoins, a fast-growing technique for cross-border funds already extensively utilized in rising markets. The corporate partnered with Bridge, a stablecoin funds platform, to simply accept funds in numerous currencies and immediately convert them into stablecoins for its world 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 fame and driving up its valuation as an infrastructure participant, fixing inefficiencies in world 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 circumstances unfold. Cross-border funds in these areas are sometimes gradual 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 foreign money 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 huge transaction quantity development for startups offering stablecoin cross-border options for companies in Africa and rising markets.
Yellow Card, which offers 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 allows 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 complete cost quantity so far.
Investor curiosity has additionally surged, with prime enterprise companies backing stablecoin-powered fintechs concentrating 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 serious backer of Bridge. Yellow Card raised $33 million, led by Blockchain Capital. Conduit, which raised a $6 million seed spherical final yr, is finalizing one other spherical. In the meantime, QED Traders 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 development is evident: Stablecoins are now 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 is just not if stablecoins will remodel funds however how rapidly they are going to stand alongside — and even exchange — outdated monetary programs.
Some numbers replicate this shift. In response to 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 minimize albeit a smaller one than the standard middlemen rails. Stripe, as an illustration, now prices 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 secure retailer of worth, with USDT and USDC changing into essential instruments.
Purposes exterior 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 enhance in customer-held USDC final yr. 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 world payroll. As distant work expands, startups like Rise permit firms to pay contractors utilizing stablecoins. The platform lets companies pay in fiat whereas contractors obtain stablecoins like USDC or USDT, avoiding foreign money volatility. Final November, Rise raised $6.3 million in Collection A, fueling its enlargement 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 area. They may supply stablecoins by partnering, buying, or constructing a crypto cost infrastructure,” Rise CEO Hugo Finkelstein instructed TechCrunch.
And whereas retail adoption of stablecoins has been slower, startups like Cashnote.io are testing options. The platform, developed by Korean fintech Korea Credit score Knowledge and web3 VC agency Hashed, allows retailers to simply 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 customers can use digital belongings for on a regular basis purchases.
Each companies are testing the platform within the Abu Dhabi International Market (ADGM), probably the most crypto-friendly regulatory environments globally. Cashnote.io is projecting to go reside with retailers within the area over the approaching months, with UAE-based digital belongings infra supplier Fuze performing because the settlement companion. 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 grow to be extra widespread in world 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. In contrast to 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 susceptible stablecoins might 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 instructed TechCrunch. “It has many sandboxes and authorities assist programs for testing modern and new crypto infrastructure.”
Equally, the UAE made headlines final yr when a court docket ruling permitted salaries to be paid in crypto, reinforcing the nation’s place as a worldwide hub for digital asset innovation.
Africa presents a special present. In lots of circumstances, innovation strikes sooner than regulation, forcing policymakers to react solely after fintech proves its worth — simply as they did with cell cash, in keeping with Zekarias Amsalu, co-founder of considered one of Africa’s prime fintech occasions. He believes regulators, reasonably 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 keen 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 contemplate formalizing stablecoins which can be offered 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 worldwide impression on stablecoins: A strict regulatory strategy — although unlikely — may gradual adoption and impose tighter monetary controls on issuers. Alternatively, a pro-stablecoin stance may encourage extra international locations to create clear licensing guidelines for digital belongings. “These are very robust indicators for buyers,” Finkelstein stated.
