5 years in the past, SpaceX launched Starlink, which has since grown into its largest income driver, increasing to greater than 100 nations. However as Starlink scaled, it confronted a significant hurdle: accepting funds in growing markets, the place conventional banking infrastructure is unreliable, gradual, and vulnerable to blocking transactions. Many native banks throughout Africa, Latin America, and Asia battle with worldwide funds, forcing SpaceX to search for 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 just accept funds in numerous currencies and immediately convert them into stablecoins for its world treasury.
This transfer positioned Bridge as a viable various to correspondent banks in markets the place conventional monetary methods fall brief. Quickly after, Stripe took notice, buying the startup for greater than $1 billion and solidifying Bridge’s repute 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, significantly in rising markets the place probably the most compelling use instances 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 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 huge transaction quantity progress 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 permits stablecoin funds for import-export companies in Africa and Latin America, noticed its annualized TPV leap to $10 billion from $5 billion. Lagos-based Juicyway, which facilitates cross-border funds utilizing stablecoins, has processed $1.3 billion in whole fee quantity to this point.
Investor curiosity has additionally surged, with prime enterprise corporations backing stablecoin-powered fintechs concentrating on these markets.
Peak XV and HongShan, the corporations 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 major backer of Bridge. Yellow Card raised $33 million, led by Blockchain Capital. QED Buyers led a $9.9 million investment in Cedar Cash, a stealthy fintech utilizing stablecoins for cross-border transactions. Initialized led an $8.5 million round 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. In the meantime, Conduit, which raised a $6 million seed round final 12 months, is finalizing one other spherical with some big-name backers.
The pattern is evident: Stablecoins are now not a crypto experiment — they’re turning into a core a part of monetary infrastructure in rising markets to maneuver cash globally. As adoption accelerates, the query shouldn’t be if stablecoins will remodel funds however how rapidly they’ll stand alongside — and even change — outdated monetary methods.
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. Cost platforms are adapting, making a lower, albeit a smaller one than the standard middlemen rails. Stripe, as an example, now fees 1.5% for stablecoin transactions, 30% decrease than its normal card charges.
Companies and people are additionally utilizing stablecoins as a hedge in opposition to inflation and a extra secure retailer of worth, with USDT and USDC turning into vital instruments.
Functions outdoors cross-border and remittance
Whereas cross-border funds and remittances have pushed early adoption, stablecoins are actually gaining traction in client finance, payroll, and, partly, retail transactions.
This January, Brazilian unicorn Nubank introduced a feature rewarding USDC holders with a 4% annual return, following a tenfold enhance 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 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 forex volatility. Final November, Rise raised $6.3 million in Series 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 massive gamers get within the area. They’ll supply stablecoins by partnering, buying, or constructing a crypto fee infrastructure,” Rise CEO Hugo Finkelstein informed 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 Data 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 property for on a regular basis purchases.
Each corporations are testing Cashnote within the Abu Dhabi World Market (ADGM), projecting to go dwell with retailers within the area over the approaching months, with UAE-based digital property infra supplier Fuze as its 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 might disrupt financial coverage. As they turn out to be extra frequent in world finance, some fear they may mirror previous issues about dollarization, the place economies rely too closely on the U.S. greenback as a substitute of constructing unbiased monetary methods.
Equally, their effectivity comes with trade-offs. In contrast to government-backed currencies, they depend upon non-public firms like Circle and Tether to keep up their worth. These firms use money reserves, short-term securities, and different monetary property to maintain stablecoins pegged to the U.S. greenback. Nonetheless, the 2022 collapse of TerraUSD shows how vulnerable stablecoins may be.
Regulatory shifts might 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 corporations to experiment with stablecoin funds. Hashed CEO Simon Kim says Cashnote.io might solely work within the area as a result of its 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 help methods for testing revolutionary and new crypto infrastructure.”
Equally, the UAE made headlines last year 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 distinct present. In lots of instances, innovation strikes quicker than regulation, forcing policymakers to react solely after fintech proves its worth — simply as they did with cell cash, in accordance with Zekarias Amsalu, co-founder of one in all Africa’s prime fintech occasions. He believes regulators, slightly than being overtly cautious, ought to embrace stablecoins as they already assist scale 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, in opposition to all actual dangers, why not take into account formalizing stablecoins which might be supplied by licensed exchanges with all transparency and compliance?” Amsalu posits.
Whether or not their stance modifications or not could depend upon how regulation shapes up within the U.S., which is contemplating new legal guidelines that will have a worldwide impression on stablecoins: A strict regulatory method — although unlikely — might gradual adoption and impose tighter monetary controls on issuers. However, a pro-stablecoin stance might encourage extra nations to create clear licensing guidelines for digital property. “These are very sturdy alerts for buyers,” Finkelstein mentioned.
