More money is moved with cross-border payments than most people realise, and the speed at which it happens is far slower than anyone would like.
The correspondent banking network underpinning most international transfers was built for a different era of transaction volumes, speed expectations, and cost of capital. Sure, it works, but at a price: settlement windows of one to five business days, during which capital sits in transit, generating cost without generating value. All the while, payment operators must maintain funded accounts across multiple currencies and markets to keep flows moving. For high-frequency, lower-value transactions – like remittances, cross-border payroll runs, and SME trade settlements that form the backbone of emerging market economies – that price compounds quickly.
This problem has persisted for so long largely because no credible alternative existed at scale. That is now changing.
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Stablecoins – dollar-pegged digital assets that settle on-chain – directly solve this inefficiency. By converting fiat currencies to a stablecoin at the point of origin, completing the cross-border leg on-chain, and then converting back to local currency at destination, payment operators can collapse settlement times from days to minutes. Capital that previously sat in transit is released almost immediately, reducing the pressure to maintain funded accounts across corridors to absorb settlement lag, resulting in lower financing costs all round. Last year, global stablecoin transaction volumes rose 72% to $33 trillion, and that activity is increasingly concentrated in the cross-border payment corridors where correspondent banking is most inefficient.
The regulatory foundation that made it possible
Stablecoins spent years suspended between credibility and suspicion, acknowledged by the institutions that might have embraced them but never quite welcomed in.
That changed decisively in 2025. The US GENIUS Act, passed in July, established the first federal framework for payment stablecoins – setting reserve requirements, redemption standards, and disclosure obligations that gave institutional operators a compliance basis to proceed. The EU’s Markets in Crypto-Assets regulation (MiCA) had brought stablecoin issuers under a binding framework of reserve requirements and disclosure standards from June 2024, with its broader provisions fully applied across the bloc by December of that year. Hong Kong’s Stablecoin Ordinance followed in August 2025, extending that foundation into one of Asia’s most active digital asset markets. Between them, these frameworks addressed the central concern that had kept treasury and compliance teams on the sideline: not whether stablecoins worked from a technical perspective, but whether they would ever satisfy a regulated institution’s risk appetite.
The market response was fast. A June 2025 EY-Parthenon survey of 350 corporate and financial services executives found that 13% were already using stablecoins, with 54% of non-users expecting to adopt them within six to twelve months. Cost savings and settlement speed were cited as the primary drivers. Among current users, 41% reported cost savings of at least 10%, concentrated in B2B cross-border payments.
Where the efficiency argument is sharpest
The corridors and use cases where stablecoin-native settlement delivers the clearest advantages have the same things in common: high transaction frequency, lower average values, and geographic reach that makes correspondent banking expensive or slow.
Cross-border payroll into markets with strong mobile wallet penetration, remittances flowing into Southeast Asia and Sub-Saharan Africa, SME trade settlements across emerging market corridors – these are the flows where the working capital argument concentrates most acutely, and where faster settlement translates directly into lower costs for the businesses and individuals on both ends of the transaction.
The longer-term case for stablecoin infrastructure extends well beyond institutional payment flows. For a migrant worker whose remittance arrives in hours rather than days, or a small exporter whose receivables clear before financing costs accumulate, faster settlement has immediate and concrete value. Right now, that opportunity remains largely ahead of the market as current adoption is concentrated elsewhere.
McKinsey estimates that Asia accounted for 60% of all stablecoin transactions in 2025, driven almost entirely by flows from Singapore, Hong Kong, and Japan. B2B payments dominate, having risen 733% year on year and accounting for roughly 60% of global stablecoin payment volume. Efficiency gains are being captured first where institutional volumes are highest and the cost of delay is most visible. The broader inclusion story is still in its early chapters.
The efficiency case for stablecoins in cross-border payments is not evenly distributed. Where multiple providers compete to convert stablecoins into local currency, the model has proven itself at scale. In the US–Mexico corridor, for example, stablecoins now account for an estimated 5–10% of total remittance flows, and fees on stablecoin rails have fallen to under 1%.
Elsewhere, the picture is more complex. The conversion infrastructure that determines whether a user actually receives the speed and cost benefits of stablecoin settlement is still thin across many of the markets where those benefits would matter most: parts of Africa, South Asia, and smaller trade corridors where provider competition is limited and conversion costs remain high. Closing that gap requires work that is regulatory and operational as much as it is technical: establishing compliant footing in each new market, building the local currency liquidity needed for consistent settlement, and extending the governance frameworks within which regulated payment businesses already operate. That process is underway in some markets and has barely begun in others. Its pace will determine whether the efficiency gains that stablecoins have already delivered in established corridors reach the broader populations for whom the cost of sending money across borders matters most.
What comes next
The constraints on scaling are well understood, if not yet resolved. Regulatory frameworks remain underdeveloped across much of Africa and South Asia – precisely where many of the highest-impact corridors run – and each new market requires its own compliance mapping. Banking sector hesitation compounds this: many institutions are watching stablecoin flows develop without yet integrating them into core operations, and their participation will matter enormously to how quickly bank-grade on- and off-ramp infrastructure reaches the markets that need it. Liquidity depth and interoperability across blockchain networks present related challenges, particularly in emerging market corridors where the local infrastructure for converting stablecoins reliably into domestic currency is still being built, and where patchy coverage can undermine the speed and cost advantages that make the model compelling in the first place.
Bloomberg Intelligence projects stablecoin payment flows will reach $56.6 trillion by 2030, a figure that reflects not extrapolation from current volumes but an assessment of how much existing cross-border infrastructure is, in principle, replaceable by faster and cheaper settlement rails.
That trajectory is not guaranteed, and the distance between current concentration in institutional flows across APAC and the broader global opportunity is real. But the direction is clear, the infrastructure is being built, and the regulatory foundations are in place in enough markets to sustain momentum. The remaining question is no longer whether stablecoins have a role in the future of cross-border payments. It is how evenly, and how quickly, that future arrives.
Sanjeev Gupta, Head Of Treasury, TerraPay
