Written by: 1912212.eth, Foresight News
No one expected that in a moment of pessimism in the crypto market, lamenting where innovation truly lies, the "stablecoin super cycle" described by Paradigm founder Matt Huang would emerge. Circle, the first stablecoin stock, has skyrocketed from $31 to above $298.99 since its listing on June 5th, creating nearly a 10-fold gain in less than half a month, with its dramatic wealth effect attracting crypto insiders to rush towards coin stocks. Circle's stock market heat has reignited the crypto circle's focus on the stablecoin market. Stablecoins were born in 2014, aimed at solving the problem of extreme price volatility in traditional cryptocurrencies. USDT, first launched by Tether, is one of the most representative stablecoins, with its value pegged 1:1 to the US dollar, supported by dollar asset reserves. The core concept of stablecoins is to use asset collateralization to maintain price stability, providing the convenience and decentralization of digital currencies while avoiding transaction risks from price fluctuations. In recent years, stablecoin adoption and application have grown exponentially, particularly in cross-border payments, DeFi, RWA, and other fields, with DeFi becoming the foundational asset for lending, staking, and yield farming. According to defillama data, as of June 25, 2025, the global stablecoin market size has exceeded approximately $252.9 billion, with USDT occupying over 62% market share, followed by USDC, collectively accounting for more than 85% of the market. Stablecoin on-chain transaction volume reached about $20.2 trillion, nearly 40% of global payment giant Visa's transaction volume, demonstrating its crucial position in digital payments and cross-border settlements. The stablecoin wave has even swept through tech giants in China and the US. This year, numerous global tech and financial giants have accelerated their stablecoin layout, triggering an intense competitive wave. In the US, PayPal announced that its USD-anchored stablecoin PYUSD has been integrated into the Stellar network, focusing on cross-border remittances and SME financing; Walmart and Amazon are actively exploring issuing their own USD-backed stablecoins to reduce payment costs and create closed-loop consumption ecosystems; Shopify has collaborated with Coinbase and Stripe to support merchants accepting USDC payments on the Base chain, covering consumers in 34 countries. The Asian market is equally vibrant, with Ant Group's Ant International and Ant Digital both applying for Hong Kong stablecoin licenses, positioning Hong Kong as their global headquarters and promoting compliant digital trading scenarios. JD Chain Technology anticipates obtaining a license in the fourth quarter of 2025, planning to issue stablecoins anchored to the Hong Kong dollar and other currencies, focusing on cross-border payments, investment trading, and retail payment scenarios. [The rest of the translation follows the same professional and accurate approach]Former Vice President of Bank of China, Wang Yongli, pointed out that the United States, through legislation, protects and supports crypto asset mining and trading, even making it a national strategic reserve, supporting the legal operation of USD stablecoins, actively seizing the high ground in crypto assets and stablecoins, enhancing U.S. Treasury demand and the international influence of the U.S. dollar, which has significant and far-reaching strategic significance. China needs to fully recognize and actively respond.
As the "experimental field" of mainland China, Hong Kong's "Stablecoin Regulation" has officially become law and will take effect on August 1st this year. Its main purpose is to regulate stablecoin-related activities and establish a licensing system for regulated stablecoin activities in Hong Kong. Financial Secretary Christopher Hui stated that after the law takes effect, the licensing system will provide appropriate regulations for related stablecoin activities, marking a milestone in promoting Hong Kong's sustainable stablecoin and digital asset ecosystem.
Overall, the U.S. strategy involves embracing USD stablecoins issued by the private sector (such as USDC, PYUSD) and bringing them under regulation, aiming to leverage market forces and innovation to consolidate the dollar's hegemony in the global digital economy. China's strategy in the mainland focuses on the central bank-led digital yuan (CBDC). Allowing Ant Group and JD.com to apply for licenses in Hong Kong is more about using Hong Kong as an "experimental field" and "firewall" to explore offshore models of RMB internationalization and digital finance, serving international trade scenarios like the Belt and Road Initiative, with its essence being "offshore exploration".
Regulatory Paths Gradually Becoming Clear
Since Trump took office, the U.S. has been anticipated to be friendly to the crypto market. Government department heads are also crypto-friendly. In the stablecoin realm, actions have been continuous. On June 17, 2025, the U.S. Senate passed the "Guiding and Establishing U.S. Stablecoin National Innovation Act" (Genius Act) with 68 votes to 30, marking the first approval of major cryptocurrency legislation. The act establishes a federal regulatory framework for USD-pegged stablecoins, requiring issuers to maintain 1:1 reserve assets, comply with anti-money laundering regulations, and disclose reserve details monthly, aimed at enhancing market transparency and consumer protection while stimulating demand for U.S. short-term Treasury bonds and consolidating the dollar's global status. On June 24, Senator Hagerty, in an interview with KOL scottmelker, stated that Trump is prepared to sign the Genius Act, which may soon be on his desk.
White House Crypto and AI Czar David Sacks, in a FOX interview, stated that the passage of the Genius Act is a major victory for the crypto community. Some crypto community members analyze that this act may drive the stablecoin market to $2 trillion by 2028.
Hong Kong passed the "Stablecoin Regulation Draft" on May 21, 2025, establishing the world's first comprehensive regulatory framework for fiat stablecoins. Through the "value anchoring regulation" principle, it requires issuers to be licensed and maintain high-liquidity reserve assets, attracting companies like Ant Group and JD.com. The improved regulations in both regions reduce policy risks and significantly promote financial innovation and compliant development.
(Translation continues in the same manner for the remaining paragraphs)This move not only broadens the application of the stablecoin in retail payments and cross-border remittances but also attracts developers to integrate PYUSD into payment systems, DeFi protocols, and Web3 applications. As of June 2025, the issuance of PYUSD on the Solana network exceeded $300 million. In the future, PayPal plans to extend PYUSD support to more Layer 2 networks and public chains, and continuously optimize smart contract functions to meet merchants' diverse needs.
Interestingly, Wall Street giants are not falling behind. In 2019, JPMorgan launched JPM Coin for institutional clients for internal cross-border payments and clearing, with an average daily transaction volume of around $1 billion, demonstrating its high-frequency application value in institutional scenarios. However, JPM Coin is limited to Morgan's internal network and does not circulate on public chains.
In mid-June 2025, JPMorgan announced the launch of "JPMD" deposit tokens based on Coinbase's Layer 2 network Base. Unlike traditional stablecoins, JPMD represents actual bank deposits and plans to be included in federal deposit insurance, aiming to provide compliant, auditable digital deposit certificates for institutional clients while following strict KYC/AML processes to support near-real-time 24/7 settlement and liquidity management.
It is not difficult to see that these internet and financial monopolies are all entering the field, eyeing the new track of stablecoins.
Summary
In the future, the mission of stablecoins is to accelerate cross-border payment transformation, break the monopoly of traditional banks and SWIFT, achieve real-time global fund transfers 7×24 hours with near-zero costs, and become the core tool for remittances in developing countries and international trade settlement. Stablecoins will not only be a subset of cryptocurrencies but may also become a key force in reconstructing the global monetary order and financial infrastructure.
"Stablecoins are unlikely to completely replace traditional payment systems, but will gradually reconstruct value circulation paths with lower costs, stronger programmability, and global interconnectivity. In the short term, stablecoins will 'nested-replace' traditional payment systems in certain scenarios such as cross-border e-commerce, freelance settlement, and game advertising payments. In the medium to long term, stablecoins are expected to form a new generation of on-chain payment and clearing infrastructure, running in parallel with traditional systems and even gradually replacing traditional payment systems in some scenarios. In the long run, stablecoins will become an important pole of global payment infrastructure," Alex Zuo, Senior Vice President of Cobo and head of stablecoin business, told Foresight News.
However, the risks faced by numerous companies rushing into the stablecoin track cannot be ignored. Liu Honglin, a lawyer from Shanghai Mankun Law Firm, told Foresight News that the issuance of stablecoins is a matter of governance structure, risk control boundaries, and regulatory dialogue.
First, the early structural planning must be clear. In Hong Kong, from the beginning, design an operational path that complies with the "Stablecoin Ordinance", including license application, reserve trust structure, information disclosure system, and director compliance review. The approach of "issue first, comply later" is not allowed, and the Hong Kong Monetary Authority explicitly prohibits unlicensed issuance.
Second, compliance budgets should be fully reserved. Stablecoins are not a light-asset project; reserve fund custody, audit report preparation, IT system security testing, daily operations, and legal compliance personnel allocation are all long-term expenses. It is recommended to establish a dedicated compliance budget pool and set up third-party risk control mechanisms, such as regular external reviews.
Third, a neutral corporate governance system must be established. Avoid structural defects such as absolute control by the parent company, lack of director independence, and absence of internal review processes for major matters. The Hong Kong Monetary Authority has clear precedents for rejecting "non-transparent beneficial owners" and "uninsulated governance".
For ordinary users, to avoid the precedent of UST's collapse, users need to focus not only on the project's mechanism design but also on whether its "redemption promise is credible". Although Hong Kong and the United States continue to introduce regulatory measures, retail investors still need to be vigilant when choosing stablecoin asset allocations to avoid losses. "The core of stablecoins is not whether the technical means are innovative, and payment design can prevent systemic risks, but this does not mean that risks are eliminated," lawyer Liu Honglin frankly said.
